Unpublished Disposition, 935 F.2d 275 (9th Cir. 1991)

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U.S. Court of Appeals for the Ninth Circuit - 935 F.2d 275 (9th Cir. 1991)

No. 90-35273.

United States Court of Appeals, Ninth Circuit.

Before WALLACE, Chief Judge, O'SCANNLAIN, Circuit Judge, and BURNS,**  District Judge.

MEMORANDUM*** 

The appellant, George Allen Paulsen, appeals the district court's grant of summary judgment in favor of his former employer, Dayton Superior Corporation (Dayton), in this action for wrongful termination. Paulsen claims the district court erred by finding he had neither a contract for continued employment nor had given additional consideration to guarantee his future employment with Dayton.

The district court did not err. The Washington Supreme Court has held that

In general an employment contract, indefinite as to duration, is terminable-at-will by either the employer or employee. But such a contract for 'permanent' or 'steady' employment (as opposed to either 'temporary' or 'lifetime' employment) is terminable by the employer only for just cause if: (1) there is an implied agreement to that effect, or (2) the employee gives consideration in addition to the contemplated services.

Roberts v. Atlantic Richfield Co., 88 Wash. 2d 887, 568 P.2d 764, 768-69 (1977) (en banc) (citations omitted) (emphasis added).1 

Paulsen contends he had a contract by virtue of alleged representations made to him by Dayton personnel. However, the evidence, which the district court described at length, demonstrates that Paulsen's understanding was purely subjective. An agreement that employment is not terminable at will "cannot be established solely by an employee's subjective understanding or expectations as to his employment." Id. at 769. Therefore, the district court correctly determined that Paulsen failed to establish a prima facie case sufficient to allow a jury to infer the existence of a contractual obligation to terminate only for just cause.

The district court was also correct that Paulsen gave no additional consideration. To constitute additional consideration, the consideration must be "in addition to the contemplated services." Id. (Emphasis added.) Paulsen contends that the additional consideration was his acceptance of the new job, a demotion, and lower pay in return for Dayton's promise that Paulsen would not be discharged once a new employee was trained.

Because a new job entails "contemplated services," it cannot be "additional consideration" for purposes of guaranteeing continued employment. Moreover, Paulsen cites no authority, and we find none, to support the contention that acceptance of a demotion and lower pay constitutes additional consideration sufficient to establish a contractual relationship for continued employment. Cf. id. (no authority to support theory that longevity of service constitutes additional consideration sufficient to establish a contract terminable only for cause). On the other hand, there is authority that the acceptance of lower pay, along with promises of lifetime appointment, is insufficient to establish a contract for permanent employment. Degen v. Investors Diversified Servs, Inc., 260 Minn. 424, 110 N.W.2d 863, 866-67 (1961).

Finally, the tests in Roberts are for the purpose of determining whether termination is for just cause, rather than at will. See 88 Wash. 2d 887, 568 P.2d at 768-69. Inasmuch as Paulsen contends he had a guarantee of future employment under the tests, rather than an agreement of termination for just cause only, he misuses the test. We also note that even an assurance of "steady" employment is insufficient to establish an implied agreement that could not be terminated for just cause. See id. 88 Wash. 2d 887, 568 P.2d at 769.

AFFIRMED.

 *

The panel unanimously finds this case suitable for submission on the record and briefs and without oral argument. Fed. R. App. P. 34(a) and Ninth Circuit Rule 34-4

 **

Honorable James M. Burns, Senior United States District Judge for the District of Oregon, sitting by designation

 ***

This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by Ninth Circuit Rule 36-3

 1

Dayton contends that Paulsen's appeal is 'defective' because he appeals only the district court's ruling on the additional consideration. Dayton's assessment is erroneous. Paulsen's appeal contends that he had a contract, either express or implied, with Dayton. Blue Brief at 2. Moreover, the test of whether termination may occur only for just cause under Washington law is stated in the disjunctive. Roberts, 88 Wash. 2d 887, 568 P.2d at 769 (either implied agreement or additional consideration). Therefore, a finding that either of the two tests is met is sufficient to find that termination may occur only for just cause