THOMAS O'HENLEY V TERRA INTL INC
Annotate this Case
Download PDF
STATE OF MICHIGAN
COURT OF APPEALS
THOMAS O’HENLEY and LINDA ANNE
O’HENLEY,
UNPUBLISHED
February 6, 2001
Plaintiffs-Appellants,
v
TERRA INTERNATIONAL, INC. and GEORGE
F. HACKMAN,
No. 217681
Huron Circuit Court
LC No. 98-000385-NZ
Defendants-Appellees.
Before: Fitzgerald, P.J., and Holbrook, Jr., and McDonald, JJ.
PER CURIAM.
Plaintiffs appeal as of right from an order granting summary disposition in favor of
defendants pursuant to MCR 2.116(C)(8) and (C)(10). We affirm in part and reverse in part.
This case involves plaintiff Thomas O’Henley’s claim that he was demoted and
discharged without just cause and that he was discriminated against because of his age. Plaintiffs
argue that the trial court erred in dismissing their various legal claims pursuant to MCR
2.116(C)(8) and (C)(10). We review a trial court’s decision to grant or deny summary
disposition de novo. Spiek v Dep’t of Transportation, 456 Mich 331, 337; 572 NW2d 201
(1998).
MCR 2.116(C)(8) permits summary disposition when the opposing party has
failed to state a claim upon which relief can be granted. A motion under this
subsection determines whether the opposing party’s pleadings allege a prima facie
case. The court must accept as true all well-pleaded facts. . . . A motion pursuant
to MCR 2.116(C)(10) tests the factual basis underlying a plaintiff’s claim. MCR
2.116(C)(10) permits summary disposition when, except for the amount of
damages, there is no genuine issue concerning any material fact and the moving
party is entitled to damages as a matter of law. A court reviewing such a motion
must consider the pleadings, affidavits, depositions, admissions, and any other
evidence in favor of the opposing party and grant the benefit of any reasonable
doubt to the opposing party. [Stehlik v Johnson (On Rehearing), 206 Mich App
83, 85; 520 NW2d 633 (1994).]
-1-
Plaintiffs first argue that the trial court erred in dismissing Mr. O’Henley’s age
discrimination claim against defendant George F. Hackman, a former supervisor at defendant
Terra International, Inc. While we agree that summary disposition should not have been granted
under subsection (C)(8), we conclude that it was properly granted under subsection (C)(10).
After reviewing the parties’ briefs, it appears that they are in agreement that Hackman
was acting as an agent of Terra at the time he demoted Mr. O’Henley. Because Hackman was
acting as an agent of Terra at this particular time, he was an “employer” under the Civil Rights
Act (CRA), MCL 37.2201 et seq.; MSA 3.548(201) et seq. MCL 37.2101(a); MSA
3.548(101)(a).1 As such, Mr. O’Henley could file a separate age discrimination claim against
Hackman for demoting him. Jenkins v Southeastern Michigan Chapter, American Red Cross,
141 Mich App 785, 799-800; 369 NW2d 223 (1985).
However, reversal is not warranted because the trial court also dismissed this claim under
subsection (C)(10). Because plaintiffs fail to argue on appeal the merits of that ruling, the issue
is abandoned. Prince v MacDonald, 237 Mich App 186, 197; 602 NW2d 834 (1999). In any
event, we conclude that the trial court did not err in dismissing this claim under subsection
(C)(10). There was no evidence that Mr. O’Henley was demoted because of his age. MCL
37.2202(1)(a); MSA 3.548(202)(1)(a).
Plaintiffs also argue that the trial court erred in determining that they failed to establish an
age discrimination claim against Terra. Again, however, plaintiffs fail to argue the merits of that
ruling. Consequently, this issue is deemed abandoned. Prince, supra at 197. Further, as with
the previous claim of age discrimination, the record is devoid of evidence that age was a
motivating factor in Terra’s decision not to retain Mr. O’Henley when the company’s workforce
was reduced. MCL 37.2202(1)(a); MSA 3.548(202)(1)(a).
Next, plaintiffs argue that the trial court erred in determining that they failed to establish a
wrongful demotion/discharge claim against Terra, because they produced evidence of contractual
just-cause employment. We agree.
An employee who has an employment contract for an indefinite term, like Mr. O’Henley
in this case, is presumed to have at-will employment. Rood v General Dynamics Corp, 444 Mich
107, 116; 507 NW2d 591 (1993). However, there are three ways that an employee can overcome
this presumption: (1) proof of a contractual provision for a definite period of time or a provision
forbidding discharge absent just cause; (2) an express agreement, either written or oral, of justcause employment; or (3) a contractual provision, implied at law, where an employer’s policies
and procedures instill a legitimate expectation of just-cause employment. Lytle v Malady (On
Rehearing), 458 Mich 153, 164; 579 NW2d 906 (1998). Plaintiffs’ argument relies on the
second of these.
1
The CRA defines “employer” as meaning “a person who has 1 or more employees, and includes
an agent of that person.” MCL 37.2201(a); MSA 3.548(201)(a).
-2-
The basic requirement of contract formation is that the parties mutually assent to be
bound. Rood, supra at 118. In deciding whether there was evidence of mutual assent to a
contract, courts use an objective test and analyze the expressed words of the parties and their
visible acts and ask whether a reasonable juror could interpret the words or conduct in the
manner that is alleged. Id. at 119. In making this inquiry, courts analyze all the relevant
circumstances surrounding the transaction, including all writings, oral statements, and other
conduct by which the parties manifested their intent. Id. Oral assurances of just-cause
employment must be clear and unequivocal to overcome the presumption of at-will employment.
Id.
In the instant case, plaintiffs presented evidence that a manager of Terra told Mr.
O’Henley and other employees during pre-employment negotiations, that Terra “just wouldn’t
walk in and fire somebody” and that it “had to have a reason to fire somebody or demote them.”
There was also evidence that the manager stated that Terra had a process to discharge an
employee that was contained in a company policy manual. Although the manager did not
distribute the company policy manual at that particular time, he told them where it was located
should they wish to review it.
When analyzing all the relevant circumstances surrounding the transaction in this case,
we believe that a reasonable juror could interpret the manager’s statements as a promise of a justcause employment relationship. Further, Mr. O’Henley contended that he interpreted these
statements as an intention to create a just-cause employment relationship. As such, when
viewing all the facts and reasonable inferences in a light most favorable to plaintiffs, we believe a
reasonable juror could conclude that there was mutual assent to a just-cause employment
relationship. Id. at 119.
Terra argues that even if plaintiffs produced such evidence, an employer can unilaterally
revoke a prior express agreement of just-cause employment by adopting an at-will policy. We
disagree. In Bullock v Automobile Club of Michigan, 432 Mich 472, 482; 444 NW2d 114 (1989),
our Supreme Court held that an employer cannot unilaterally revoke a prior express agreement of
just-cause employment by adopting an at-will policy. Rather, such actions may only be
construed as an “offer to modify” the contrary terms of a prior express agreement. See Farrell v
Automobile Club of Michigan (On Remand), 187 Mich App 220, 228; 466 NW2d 298 (1991).
An employee does not accept the offer to modify merely because the employee continues to work
for the employer. Id. It is for a trier of fact to determine, by examining the surrounding facts and
circumstances, whether the employee accepted the offer to modify and thus modified the prior
express agreement. Id. Consistent with Farrell, because Terra’s adoption of employee manuals
and handbooks that contained at-will disclaimers may only be construed as an offer to modify, it
was for a trier of fact to determine whether Mr. O’Henley accepted the offer and thus modified
the prior express agreement. Id. Accordingly, we conclude that the trial court erred in granting
summary disposition in favor of Terra pursuant to MCR 2.116(C)(10) regarding plaintiffs'
wrongful demotion/discharge claim.
Finally, plaintiffs argue that the trial court erred in ruling that plaintiff Linda O’Henley
failed to state a claim for loss of consortium. We disagree for two reasons. First, plaintiffs’
complaint did not include a count alleging a separate cause of action for this claim. Eide v
-3-
Kelsey-Hayes Co, 431 Mich 26, 37; 427 NW2d 488 (1988). Rather, plaintiffs merely subsumed
this claim within the age discrimination claims in Count II of the first amended complaint.
Second, Mrs. O’Henley did not request damages for loss of society and companionship. Id. at
29. Instead, she simply requested damages for emotional distress and loss of income. We
therefore conclude that the trial court correctly granted summary disposition for defendants
pursuant to MCR 2.116(C)(8) on this claim.
Affirmed in part and reversed in part.
/s/ E. Thomas Fitzgerald
/s/ Donald E. Holbrook, Jr.
/s/ Gary R. McDonald
-4-
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
