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Tameny v. Atlantic Richfield Co.

Supreme Court of California

June 2, 1980

L.A. No. 31100

Opinion

 [*169]  [**1330]  [***840]    Plaintiff Gordon Tameny instituted the present action against his former employer,  [****2]   [**1331]  Atlantic Richfield Company (Arco), 1 alleging that Arco had discharged him after 15 years of service because he refused to participate in an illegal scheme to fix retail gasoline prices. Plaintiff sought recovery from Arco on a number of theories, contending, inter alia, that Arco's conduct in discharging him for refusing to commit a criminal act was tortious and subjected the employer to liability for compensatory and punitive damages under normal tort principles.

Arco demurred to the complaint, contending that plaintiff's allegations, even if true, did not state a cause of action in tort. Arco conceded that California authorities establish that an employee who has been fired for refusing to perform an illegal act may recover from his former employer for "wrongful discharge." Arco contended, however, that [****3]  the employee's remedy in such cases sounds only in contract and not in tort. The trial court accepted Arco's argument and sustained a general demurrer to plaintiff's tort causes of action. Plaintiff now appeals from the ensuing judgment.

For the reasons discussed below, we have concluded that the trial court judgment must be reversed with respect to the issue of tort liability.  [*170]  As we shall explain, past cases do not sustain Arco's contention that an employee who has been discharged because of his refusal to commit an illegal act at his employer's behest can obtain redress only by an action for breach of contract. Rather, as we shall see, the relevant authorities both in California and throughout the country establish that ] when an employer's discharge of an employee violates fundamental principles of public policy, the discharged employee may maintain a tort action and recover damages traditionally available in such actions.

1. The facts and proceedings below.

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27 Cal. 3d 167 *; 610 P.2d 1330 **; 164 Cal. Rptr. 839 ***; 1980 Cal. LEXIS 171 ****; 1 I.E.R. Cas. (BNA) 102; 9 A.L.R.4th 314; 115 L.R.R.M. 3119; 121 Lab. Cas. (CCH) P56,822; 1980-2 Trade Cas. (CCH) P63,378

GORDON TAMENY, Plaintiff and Appellant, v. ATLANTIC RICHFIELD COMPANY et al., Defendants and Respondents

Subsequent History:  [****1]  Appellant's petition for a rehearing was denied July 2, 1980. Clark, J., was of the opinion that the petition should be granted.

Prior History: Superior Court of Los Angeles County, No. C 194036, Robert I. Weil, Judge.

Disposition:  The judgment is reversed and the case is remanded to the trial court for further proceedings consistent with this opinion.

CORE TERMS

wrongful discharge, public policy, termination, discharged, cases, cause of action, contractual, tort cause of action, decisions, tort action, damages, punitive damages, trial court, antitrust, demurrer, alleges, commit perjury, give rise, circumstances, authorities, employees, gasoline, dealers, commit, courts, employment contract, breach of contract, instant case, compensatory, contravenes

Labor & Employment Law, Employment Relationships, Employment Contracts, Breaches, Wrongful Termination, General Overview, Public Policy, Remedies, Civil Procedure, Responses, Defenses, Demurrers & Objections, Demurrers, Motions to Dismiss, Failure to State Claim, Appeals, Standards of Review, At Will Employment, Duration of Employment, Contracts Law, Breach, Breach of Contract Actions, Torts, Business Torts, Bad Faith Breach of Contract, Consideration, Enforcement of Promises, Breach of Contract, Implied Contracts, Whistleblower Protection Act