Robert A. HUNIO, Plaintiff and Respondent, v. TISHMAN CONSTRUCTION CORPORATION OF CALIFORNIA et al., Defendants and Appellants.
This is an employment discrimination case. The parties are Robert A. Hunio, the plaintiff and respondent; Tishman Construction Corporation of California (“Tishman”) and Tishman Realty and Construction Company (“TRCC”), defendants and appellants; and defendants Abraham S. Bolsky, the president and chief executive officer of Tishman, and Joseph Garron, executive vice-president and chief operating officer of Tishman.1 Hunio reported directly to Garron.
STATEMENT OF THE CASE
The complaint in this case was filed on August 4, 1988, and amended on December 5, 1990. As amended, it stated five causes of action: (1) that Hunio was constructively discharged in breach of an implied-in-fact employment contract guaranteeing his discharge only for good cause; (2) that Hunio's alleged constructive discharge was in breach of the implied covenant of good faith and fair dealing; (3) that Tishman intentionally caused Hunio to suffer emotional distress; (4) that Hunio was constructively discharged because of his age, in violation of the California Fair Employment and Housing Act (“FEHA”; Gov.Code, § 12900 et seq.); and (5) that Hunio was harassed because of his age in violation of FEHA. Hunio dismissed the third cause of action prior to the trial.
The jury trial lasted more than two months. After eight days of deliberation, the jury returned a nine to three verdict in Hunio's favor on all causes of action, awarding Hunio a total of $7.1 million—$2.1 million in economic damages, $4 million in emotional distress damages, and $1 million in punitive damages.
The trial court denied Tishman's motion for judgment notwithstanding the verdict (“JNOV”), but conditionally granted Tishman's motion for a new trial unless Hunio accepted a $2 million remittitur of his emotional distress damages award. After Hunio accepted the remittitur, the trial court denied Tishman's motion for a new trial. The trial court later awarded Hunio $1,163,457 in attorney fees and costs and an additional $591,780 in prejudgment interest. Tishman filed a timely notice of appeal.
Hunio began employment with Tishman in June 1960. At the time he filed his complaint, Hunio had served Tishman for 27 years, was 56 years of age, and had attained the position of first vice-president at Tishman with an annual salary of $104,000. His salary was the result of continuous pay increases over the years and represented the rewards of age and seniority. Hunio testified that he had been promised lifetime employment and that he was looking forward to retirement in six or seven years. His position was the third highest in Tishman's California operation.
In 1986, Hunio was assigned to the 30–story, $40 million Grand Promenade project at the request of Tishman's client, Goldrich & Kest. He was assigned as both the project executive and the project manager. In such position, he was the highest ranking Tishman executive at the job site. Hunio testified that he started having difficulties with Goldrich & Kest in early 1986. He testified he told Garron that Goldrich and Kest were very abrasive and abusive and that Garron instructed him that if this conduct continued to “just walk right out of the meetings.”
On June 18, 1987, Hunio walked out of a meeting with Goldrich & Kest. Hunio testified that, after a particularly vilifying session, he said to Sol Kest: “Gentlemen, we have another couple of years to go on this project. Stop behaving like this. Let's all conduct ourselves like gentlemen, because I'm not going to take this kind of behavior for two more years.” Sol Kest then said, “If you don't like it, don't wait two months, don't wait two weeks, don't wait two days. Get out now.” Hunio walked out and called Garron.
On June 22, 1987, Hunio requested that Garron reassign him to another project because “[t]he owners' reps and I do not get along, and they have stated: if you don't like it, get out. So, I am getting out. Thus, they will be satisfied and so will I.” Garron met at the job site with the owners and then told Hunio to return because the owners did indeed want him. When Hunio refused to reconsider his decision, Tishman brought in another employee, George Noonan, as the project manager. After turning the project over to Noonan, Hunio went on a previously scheduled vacation.
Upon his return from vacation, Hunio assisted on a number of projects. On September 29, 1987, Hunio was called into Bolsky's office and was informed that there was no project to put him on and that, if Tishman could not find a project to put him on, they would have to consider letting him go. Bolsky told him that Hunio's high salary was also a problem. The following day, Hunio met with Garron and was told a decision was made to terminate him. He was told he would be given severance pay and that he could use his Tishman offices to get a new job. He was given the option of one large check and no benefits or four monthly checks and continued benefits until February 1. He chose the latter option.
The next day, Hunio was told by Garron that he would receive a letter of recommendation. He was further told that, although Tishman could not continue to carry him on the payroll, he was not to inform potential employers of this fact.
On October 2, 1987, Bolsky said Hunio was “not terminated,” but that he was “on notice” that he had to leave Tishman. He was advised to “see what is out there.” He was told that his pay over four or five months should be “consider [ed] severance pay.” When the Pico Roxbury project came up, a younger man in his 20's was assigned to it instead of Hunio. Hunio offered to relocate, take a salary reduction, or take an unpaid leave of absence until things got better in order to save his job. This offer was rejected. He was denied a year-end bonus. He was told that, if a job came up, he would be retained, but that he should determine an end date. He began to see a psychiatrist in October.
Younger men were put in charge of Tishman jobs on the Ronald Reagan State Building and the Carlisle project. Hunio testified he was shocked and demoralized each time younger men were assigned jobs that he was capable of doing.
In late January 1988, just before Hunio thought he would have to leave, he was assigned to three new minor projects that had come up and told by Bolsky to forget all previous conversations about looking for a job elsewhere. Hunio testified that he did not know from day to day whether he was being retained or let go because, although Bolsky said to forget about looking elsewhere, Bolsky started to blame Hunio for the loss of the Grand Promenade project. From January 22nd to March 23rd, Hunio worked on the three minor projects to the apparent satisfaction of Tishman.
On March 23, 1988, unable to bear the uncertainty of unemployment after 27 years on the job, Hunio entered a psychiatric hospital. His physicians testified that it was the repeated inconsistent, ambiguous and conflicting messages from Hunio's superiors, coupled with the threat of the loss of his career, his retirement and his lifetime medical benefits which caused him to suffer a severe depression. Hunio's doctor told him it would be detrimental to his health and would seriously undermine his psychiatric therapy for him to return to work at Tishman. Accordingly, on April 1, 1988, while hospitalized, Hunio resigned.
Tishman responded to Hunio's resignation letter by stating that Hunio had not been terminated under any circumstances and that Hunio should immediately take advantage of Tishman's disability program. Hunio did not do so and instead maintained the position that Tishman's conduct had effectively terminated his employment.
The issues presented essentially break down into four. First, whether the trial court erred in failing to grant Tishman's motion for JNOV on the first, second, and fourth causes of action on the ground that there was no substantial evidence that Hunio was constructively discharged; second, whether the trial court erred in failing to grant Tishman's motion for JNOV on the ground that there was no substantial evidence that Tishman intentionally discriminated against Hunio because of his age; third, whether the trial court erred in denying Tishman's motion for a new trial on the grounds that (1) the record was infected with inadmissible hearsay evidence, including a litigation diary reflecting Hunio's version of the facts, (2) the trial court failed to instruct the jury on certain essential issues, (3) the trial court gave a jury instruction prejudicial to Tishman that was allegedly justified neither by the facts nor the law, and/or (4) the damages award of $5.1 million was excessive; and fourth, whether the trial court erred in awarding Hunio $591,780 in prejudgment interest and $1,163,457 in attorney fees and costs.
Tishman alleges that the trial court erred in failing to grant its motion for JNOV on the first, second, and fourth causes of action on the ground that there was no substantial evidence that Hunio was constructively discharged. In so asserting, Tishman refers this court only to the evidence which was most favorable to it.
“In resolving the issue of the sufficiency of the evidence, we are bound by the established rules of appellate review that all factual matters will be viewed most favorably to the prevailing party [citations] and in support of the judgment [citation]. All issues of credibility are likewise within the province of the trier of fact. [Citation.] ‘In brief, the appellate court ordinarily looks only at the evidence supporting the successful party and disregards the contrary showing.’ [Citation.] All conflicts, therefore, must be resolved in favor of the respondent. [Citation.]” (Nestle v. City of Santa Monica (1972) 6 Cal.3d 920, 925–926, 101 Cal.Rptr. 568, 496 P.2d 480, emphasis omitted.) When viewed in the appropriate context, the record contains ample evidence from which the trier of fact could rule in favor of Hunio having been constructively discharged.
“The Fair Employment and Housing Act provides that the opportunity to hold employment without discrimination because of age is a civil right. (Gov.Code, § 12921.) Because the language and objectives of California's Fair Employment and Housing Act as it relates to age discrimination closely parallel the language and objectives of the federal Age Discrimination in Employment Act (29 U.S.C. § 621 et seq.), we refer to federal decisions where appropriate. [Citation.]” (Stephens v. Coldwell Banker Commercial Group, Inc. (1988) 199 Cal.App.3d 1394, 1399, 245 Cal.Rptr. 606.) 2
Whether conditions were so intolerable as to justify a reasonable employee's decision to resign is normally a question of fact. (Thomas v. Douglas (9th Cir.1989) 877 F.2d 1428, 1434.)
Constructive discharge was characterized in Valdez v. City of Los Angeles (1991) 231 Cal.App.3d 1043, 1056, 282 Cal.Rptr. 726, as follows: “The general rule ․ requires that a plaintiff alleging constructive discharge show the existence of ‘aggravating factors' [Citation]. This requirement can be met by showing a ‘continuous pattern of discriminatory treatment over a period of years.’ [Citation.]”
The evidence presented to the trier of fact in the instant case indicates a pattern of harassment over many months culminating in Hunio's 1987 resignation. The evidence indicates that Hunio was told by Garron, acting on behalf of Tishman, that he was “terminated.” He was told that his pay was “severance pay.” He was subjected to an intolerable working environment by denying him a raise and Christmas bonus on Christmas Eve 1987. Every Tishman employee except Hunio received a bonus. He was told that business was “slow,” yet projects came up to which others were assigned, and this was less than three months after Tishman/TRCC top executives paid themselves $4 million in bonuses. Hunio was stripped of his management staff, responsibilities, and authority. He was not assigned to projects which he was qualified to head, while younger men were promoted to project managers in his stead.
For the six months prior to his hospitalization, Hunio mostly sat in his glass-walled office working only 20 to 25 percent of the time. Tishman leaked word to Hunio's fellow employees that he was terminated or was leaving the company, causing him to be shunned by them.
Despite the fact that Tishman placed great emphasis on its defenses that it allegedly had good cause to discharge Hunio, Bolsky and Garron conceded at the trial that Tishman never had a good reason to terminate Hunio. Garron admitted that he observed Hunio was shocked when advised that he was being terminated. Hunio testified that Garron had said to him that he was shocked at the way the company was treating him.
The evidence is clear that for six months Hunio was subjected to Tishman's abusive treatment and mixed messages that he was terminated and then that he was not terminated, but that in any event he had to take his “severance pay.” Hunio even offered to be transferred or to take a salary cut or unpaid leave. However, Bolsky (the head of Tishman's operations in California) persisted in trying to peg an end date. It is, therefore, reasonable for the trier of fact to have found that the psychological stress imposed by Tishman and its agents, Bolsky and Garron, constituted duress resulting in Hunio's forced resignation. It is equally reasonable that Tishman had full knowledge of what its principal employee in California was doing to Hunio. There does not appear to be any indication in the record that Tishman disavowed Bolsky's harassment of Hunio.
While Tishman makes much of the argument that Hunio, when faced with the loss of his income, his retirement benefits, and his lifetime medical insurance for himself and his wife, sought legal counsel, we conclude that a reasonable person would have been imprudent not to have sought legal advice. We agree with the lower court that a basis to grant JNOV on these causes of action does not exist; we refuse to second-guess the jury.
Tishman argues that the trial court should have granted JNOV on the fourth and fifth causes of action because Hunio failed to prove that Tishman intentionally discriminated against him due to his age. We disagree.
Intentional discrimination due to age is prohibited by Government Code section 12941. A complainant who alleges that he or she was discriminated against because of age has the burden of proving a violation. (Kerrigan v. Fair Employment Practice Com. (1979) 91 Cal.App.3d 43, 154 Cal.Rptr. 29.) The prima facie burden consists of these elements: (1) that plaintiff was over 40 years old; (2) that the employee was performing his/her job satisfactorily; (3) that the employee suffered adverse employment action (i.e., constructive discharge in the instant case); and (4) that he/she was replaced by someone younger or other circumstantial evidence of age discrimination. (Rose v. Wells Fargo & Co. (9th Cir.1990) 902 F.2d 1417, 1421; McDonnell Douglas Corp. v. Green (1973) 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668.)
Tishman does not dispute the first two elements. Hunio was 56 years old and considerable evidence was presented that he was a satisfactory employee. The third element was dealt with in our previous discussion affirming his constructive discharge. As to the fourth element, Tishman argues that it “therefore was under no legal obligation to terminate a younger employee to avoid laying off Hunio.” This argument absolutely misses the mark. The issue is not laying off a younger employee, it is discriminating against an older employee.
Evidence was presented to the trier of fact that Tishman was increasing its operations rather than decreasing its work force. At the time of Hunio's constructive discharge, Tishman was in its eighth year of expansion and was experiencing the greatest year in its history, with construction contracts totaling $3.4 to $4.1 billion; the company was promoting and hiring people; and there was no adverse financial event and no layoff or reduction in force. Hunio testified that, at the time of the alleged lack of work in September 1987, there were in fact over 35 projects in the negotiating stages. Other Tishman officers testified that there was no reason to put a project manager on notice for lack of work in 1987 or 1988, that they had never been told there was a shortage of work, and that they were all very busy.
Business was booming to such an extent that Tishman's top executives awarded themselves $4 million in bonuses, including $1 million to Bolsky. Yet, despite this apparently booming construction market, Hunio was not given a bonus, and was told that his salary was too high and that the company could not afford to carry him, that he was being “terminated,” and that his salary was “severance pay.” This constant harassment as to having a job, then not having a job, back to “severance” and then back again to “forget about seeking work elsewhere” has been accurately characterized by Hunio as “play[ing] Russian roulette with [his] future.” Sufficient evidence exists which demonstrates that Hunio was subjected to a pattern of emotionally abusive and discriminatory treatment. Such intolerable working conditions meet the requirements of a “continuous pattern of discriminatory treatment.” (Real v. Continental Group, Inc. (N.D.Cal.1986) 627 F.Supp. 434, 443; Nolan v. Cleland (9th Cir.1982) 686 F.2d 806, 813–814; Watson v. Nationwide Ins. Co. (9th Cir.1987) 823 F.2d 360, 361–362.) 3
Part of the argument Tishman made to Hunio was that the company wanted to save money, i.e., that his salary was one of the highest in the company. It is well established that an employer's desire to save the higher salary of an older employee is not a permissible, nondiscriminatory justification for replacing that employee with a younger employee at a lower salary. (Metz v. Transit Mix, Inc. (7th Cir.1987) 828 F.2d 1202; Bruno v. W.B. Saunders Co. (3d Cir.1989) 882 F.2d 760, 769; Wolf v. Ferro Corp. (W.D.N.Y.1991) 772 F.Supp. 139, 142–143; Visser v. Packer Engineering Assoc., Inc. (7th Cir.1991) 924 F.2d 655, 658; Jardien v. Winston Network, Inc. (7th Cir.1989) 888 F.2d 1151, 1157–1158; White v. Westinghouse Electric Co. (3d Cir.1988) 862 F.2d 56, 62.)
Tishman alleges it should have been granted a new trial because the trial court committed reversible error. Tishman's argument is fourfold: (1) that the record is “infected with inadmissible evidence,” including a litigation diary reflecting Hunio's version of the facts; (2) that the trial court failed to instruct the jury on certain essential issues; (3) that the trial court gave a Metz jury instruction which was neither justified by the facts nor the law; and (4) that the damages award was excessive.
The “Infected” Record
A thorough review of the record indicates Tishman's allegations of an “infected” record consist of (a) the admission of Bolsky's statement to another employee to “make [Hunio] quit”; (b) the admission of Hunio's diary and supplemental diary; and (c) the admission of some hearsay statements.
a. Bolsky's Statement
Hunio testified that in 1985, prior to any action being taken against him, he heard Bolsky say on the telephone, “Give him minimum raises and bonuses. Give him chicken shit work to do. Make it hard for him but not too hard. We have to be careful because of his age and years with the company. We don't want a wrongful termination suit.” The record indicates there was no objection to the question by Tishman's counsel nor any motion to strike the testimony. An appellant may not contend that the trial court committed error unless he/she has tendered an objection to the trial court on the ground asserted. (People v. Newlun (1991) 227 Cal.App.3d 1590, 1604, 278 Cal.Rptr. 550.) Therefore, this issue has been waived and is not properly before this court.
b. Hunio's Diary
We note that from the very onset of the trial in Tishman's opening statement, counsel expressly charged that Hunio's version of the events was a “fantasy and fabrication.” During the cross-examination of Hunio and of his wife, Tishman's counsel repeatedly challenged the authenticity of their testimony as well as their preparation and the alleged differences in the three editions of Hunio's diary, clearly implying recent editing and insinuating the diary was recently fabricated or altered.
In order to counter the implications made by Tishman's counsel, it was entirely proper for Hunio's counsel to permit his client to refresh his recollection from the diary itself, as well as to question him about prior deposition testimony given by Hunio in the same regard after the requirements of Evidence Code section 791 were met.4
A prior consistent statement is admissible over a hearsay objection if the statement is offered after an implied charge has been made that the witness's testimony is recently fabricated or influenced by bias or other improper motive. (People v. Randle (1992) 8 Cal.App. 4th 1023, 1037, 10 Cal.Rptr.2d 804; see also People v. Cannady (1972) 8 Cal.3d 379, 105 Cal.Rptr. 129, 503 P.2d 585.) “The admission in evidence of an early statement of the witness ․ was justified as an attempt to rebut the inferential charge that the witness had made a recent fabrication ․; this showed an early statement in line with his then current testimony. [Citations.]” (Weisbart v. Flohr (1968) 260 Cal.App.2d 281, 293, 67 Cal.Rptr. 114.)
Tishman's claim that the diary statements are inadmissible because they were entered into the diary after October 1, 1987, “when his motive for fabrication is alleged to have arisen,” is unsupported by the evidence. It was on September 30, 1987, that Garron advised Hunio that his salary over the next four months should be considered “severance pay.” The next day, Hunio consulted an attorney. It was at the suggestion of his attorney thathe started a diary. Hunio dictated the diary to his wife, who typed it into a computer at home.
The implication raised by Tishman, that a person seeking counsel thereby creates a “motive for fabrication,” is shocking. Seeking counsel does not equate with a motive to fabricate. Given that Hunio was told that he was to receive “severance pay,” the attorney's advice to keep a diary was simply sound legal guidance.
Thus, Tishman's counsel having raised the implication that Hunio's statements were recently fabricated, Hunio could properly rebut such inferences by referring to a document previously prepared. “ ‘When a witness has been charged with improper motives of interest, or improper influences, or with recent fabrication, the law allows hearsay statements to be introduced for the purpose of showing that the same and consistent statements had been made at a time prior to the alleged fabrication OR prior to the time the motive of interest existed.’ ” (Bickford v. Mauser (1942) 53 Cal.App.2d 680, 687, 128 P.2d 79, emphasis in original.) The oral testimony having included practically the entire diary, the document was properly admitted.
The “make him quit” document which was produced at the trial is referred to by Tishman as the “supplemental diary.” It was introduced into evidence. Tishman alleges it was improper for the trial court to do so. We agree.
The supplemental diary is not admissible under Evidence Code section 1250, subdivision (b),5 because it was not written at the time of the event. (Benwell v. Dean (1967) 249 Cal.App.2d 345, 57 Cal.Rptr. 394.) Yet, the jury had already heard the testimony of the “make him quit” conversation and the jury knew the document itself was prepared two years after the events for Hunio's attorney. Its admission under these circumstances could not have prejudiced Tishman because it appears from the record that it was cumulative of Hunio's own testimony and therefore harmless. (Cf. People v. Chambers (1982) 136 Cal.App.3d 444, 453, 186 Cal.Rptr. 306.)
c. Hearsay Statements
Tishman argues that Hunio's testimony about his perception of Tishman's treatment of other employees was erroneously admitted, highly prejudicial, and constituted reversible error. Specifically, Tishman protests Hunio's testimony concerning Meyer Weingarten, Bolsky's predecessor at Tishman. Yet, at the time the issue arose at the trial, the only objection made was on the basis of a lack of foundation and, when a foundation was laid, no further objection was made. “ ‘[I]t would be wholly inappropriate to reverse a superior court's judgment for error it did not commit and that was never called to its attention.’ ” (People v. Newlun, supra, 227 Cal.App.3d at p. 1604, 278 Cal.Rptr. 550, citing People v. Lilienthal (1978) 22 Cal.3d 891, 896, 150 Cal.Rptr. 910, 587 P.2d 706.) 6
The Jury Instructions
Parenthetically, we note that Tishman's arguments regarding jury instructions are contained entirely in footnotes. We shall dispose of these arguments with equal brevity.
Our standard of review is dictated by Sills v. Los Angeles Transit Lines (1953) 40 Cal.2d 630, 633, 255 P.2d 795, which held that on appeal we must view the evidence in the light most favorable to the claim of instructional error. Applying this test, we find no fault with the trial court.
Tishman's proposed instructions O and R were based respectively on Malmstrom v. Kaiser Aluminum & Chemical Corp. (1986) 187 Cal.App.3d 299, 231 Cal.Rptr. 820, and Simpson v. Midland–Ross Corp. (6th Cir.1987) 823 F.2d 937, both of which are reduction in force cases. As indicated in section II, ante, the evidence presented to the trier of fact was that Tishman was increasing its operations rather than decreasing its work force. Consequently, the facts do not support giving either instruction.
Tishman's proposed instruction W was based upon United Air Lines, Inc. v. Evans (1977) 431 U.S. 553, 97 S.Ct. 1885, 52 L.Ed.2d 571. This case involved an airline stewardess who requested reinstatement of seniority rights after a period of separation from employment. The discriminatory practice in Evans took place before the passage of the federal statute. In the instant case, the facts differ so materially that we concur with the trial court's decision not to give the instruction.
Tishman argues that the court erred in giving an instruction based on Metz v. Transit Mix, Inc., supra, 828 F.2d 1202. That case holds that an employer's desire to save the higher salary of an older employee is not a permissible nondiscriminatory justification for replacing that employee with a younger employee with a lower salary. Since Hunio testified that his high salary was a consideration in his termination, we find no fault with the Metz instruction.
The General Issue of Damages
Tishman alleges it should be granted a new trial pursuant to Code of Civil Procedure section 657, subdivision (5),7 because the damages award is excessive even considering the reduction from $7.1 million to $5.1 million.
Our standard of review is limited. Appellate review goes only to establish whether the award is excessive, i.e., only if “ ‘․ the verdict is so large that, at first blush, it shocks the conscience and suggests passion, prejudice or corruption on the part of the jury.’ ” (Fagerquist v. Western Sun Aviation, Inc. (1987) 191 Cal.App.3d 709, 727, 236 Cal.Rptr. 633; Schroeder v. Auto Driveaway Co. (1974) 11 Cal.3d 908 919, 114 Cal.Rptr. 622, 523 P.2d 662.) We must review the record in the light most favorable to the judgment. (Fortman v. Hemco, Inc. (1989) 211 Cal.App.3d 241, 259, 259 Cal.Rptr. 311.)
The jury awarded $2.1 million in economic damages. Hunio's expert, Professor Herbert Spiro, received his doctorate in business economics and finance from the University of California at Los Angeles. Tishman called as its economic expert Michael P. Ward, who received his doctorate in economics from the University of Chicago. The record is clear that both experts had the requisite “special knowledge, skill, experience, training, and education” to qualify them to render expert opinion testimony on Hunio's losses. (Evid.Code, § 801, subd. (b); see also Korsak v. Atlas Hotels, Inc. (1992) 2 Cal.App. 4th 1516, 1523, 3 Cal.Rptr.2d 833; Alef v. Alta Bates Hospital (1992) 5 Cal.App. 4th 208, 219, 6 Cal.Rptr.2d 900; Jackson v. Deft, Inc. (1990) 223 Cal.App.3d 1305, 1319–1320, 273 Cal.Rptr. 214.)
A review of the testimonial record of both experts clearly reveals the strategy of thrust and counter-thrust. It is clear the jury chose to accept the analysis set forth by Dr. Spiro. His testimony set Hunio's loss at $2,054,821 utilizing present value calculations on a federal discount rate of 8.5 percent, but by the time of the trial the discount rate had in fact declined significantly. And, although Hunio testified that he anticipated working past age 65, Dr. Spiro considered that to be Hunio's retirement age. Tishman argues that several of Dr. Spiro's calculations were inaccurate or inflated, e.g., the inflation factor, the personal component of Hunio's business expenses, damages for lost insurance benefits for Hunio and his wife, and the mortality tables applicable to these benefits. Yet it is clear that all parties to this protracted litigation were represented by well qualified and competent counsel who argued these issues to the jury. The resultant verdict cannot be considered surprising.
“When the sufficiency of the evidence to sustain a finding of fact is contested on appeal, the issue thus presented is whether there is any substantial evidence, direct or indirect, contradicted or uncontradicted, which will support the finding [citations].” (Davis v. Kahn (1970) 7 Cal.App.3d 868, 874, 86 Cal.Rptr. 872.) Thus, the jury's award of $2.1 million is not unconscionable or shocking and does not appear to have been based on passion. Rather, it was based upon a reasonable interpretation of the loss set forth by Dr. Spiro. “Where the fact of damage is clear, the trier of fact is permitted a reasonable approximation in determining the amount. [Citation.]” (Channell v. Anthony (1976) 58 Cal.App.3d 290, 317, 129 Cal.Rptr. 704.)
The Emotional Distress Award
Our scope is limited. This court is bound by the substantial evidence standard of review. “The reviewing court does not act de novo․ [T]he trial court's determination of whether damages were excessive ‘is entitled to great weight’ because it is bound by the ‘more demanding test of weighing conflicting evidence than our standard of review under the substantial evidence rule․’ [citation]. All presumptions favor the trial court's determination [citation] and we review the record in the light most favorable to the judgment (Neal v. Farmers Ins. Exchange (1978) 21 Cal.3d 910, 927 [148 Cal.Rptr. 389, 582 P.2d 980] ).” (Fortman v. Hemco, Inc., supra, 211 Cal.App.3d at p. 259, 259 Cal.Rptr. 311.)
The trial court reduced the jury verdict from $4 million to $2 million. This reflects a significant awareness by the trial court of the evidence. There can be no doubt that Hunio sustained substantial psychological and emotional trauma. For 27 years, he toiled for his employer and worked long and hard to achieve the third highest post in the company's California hierarchy, expecting that his senior years would be ones commanding respect and esteem. Instead Tishman caused him to be humiliated, harassed, and vilified. He was shattered. His self-esteem was destroyed. His reputation was destroyed. He was scoffed at by his peers. He was rendered impotent. Finally, Hunio was required to seek psychiatric hospitalization. His future is now one necessitating lifetime anti-depressant medication and psychiatric care.
Humiliation has a price tag. It clearly appears to this court that the trial court in the instant case has the best insight into what the price tag should be. Since the trial court cut the award given by the jury in half, it has clearly weighed the evidence and, absent a clear showing of abuse of discretion, we will not disturb its decision.
“Whether punitive damages should be awarded and the amount of such an award are issues for the jury and for the trial court on a new trial motion. All presumptions favor the correctness of the verdict and judgment. [Citation.] While the trial court's determination is not binding upon a reviewing court, it must be accorded great weight. [Citation.] An award of punitive damages will be reversed as excessive ‘only when the entire record viewed most favorably to the judgment indicates the award was rendered as the result of passion and prejudice. [Citation.]’ [Citations.]” (Devlin v. Kearny Mesa AMC/Jeep/Renault, Inc. (1984) 155 Cal.App.3d 381, 387–388, 202 Cal.Rptr. 204.)
A trial court award of punitive damages requires a showing of “oppression, fraud, or malice” by “clear and convincing evidence.” (Civ.Code, § 3294.) 8 However, appellate courts in reviewing the propriety of a punitive damages award are bound by the substantial evidence standard. Appellate courts cannot substitute their judgment on conflicting evidence to override the decision at trial that the plaintiff met the “clear and convincing” standard of proving “oppression, fraud or malice.” (Patrick v. Maryland Casualty Co. (1990) 217 Cal.App.3d 1566, 1576, 267 Cal.Rptr. 24.)
Devlin indicates that net worth is the best measure for assessing punitive damages. Tishman stresses that punitive damages should not bankrupt the defendant. (See Dumas v. Stocker (1989) 213 Cal.App.3d 1262, 1269, 262 Cal.Rptr. 311.) Goshgarian v. George (1984) 161 Cal.App.3d 1214, 1228, 208 Cal.Rptr. 321, sets a standard that awards exceeding 10 percent of a defendant's net worth “have generally been disfavored by the appellate courts.” However, the Supreme Court has refused to hold “that any particular measure of ability to pay is superior to all others or that a single standard is appropriate in all cases.” (Adams v. Murakami (1991) 54 Cal.3d 105, 116, fn. 7, 284 Cal.Rptr. 318, 813 P.2d 1348.)
The evidence of Tishman's net worth was hotly disputed before the trier of fact. Hunio produced evidence that Tishman's net worth was at least $9 million in cash, $1.5 million in government securities, and $61 million in gross assets. Tishman's analysis was closer to $7 million, although its own expert on cross-examination testified he could not tell whether the net worth of the company was more than or less than $35 million. Likewise, counsel give dramatically varying examples of punitive damage awards in somewhat similar circumstances.9
Public policy dictates that punitive damages should hurt, thereby hopefully serving to deter such onerous future conduct.
Hence, whether Tishman's net worth was $61 million or $35 million, or only $7 million, it is quite clear that it was enormously profitable. At the time of Hunio's constructive discharge, Tishman had construction contracts totaling $3.4 to $4.1 billion. The company was so profitable that it had just given Bolsky a bonus of $1 million. In this context, the jury's award of $1 million punitive damages is certainly within permissible limits. Under the substantial evidence standard of review, we will not disturb it.
The final issue is whether the trial court erred in awarding Hunio $591,780 in prejudgment interest and $1,163,457 in attorney fees and costs.
Relying on Blim v. Western Electric Co. (10th Cir.1984) 731 F.2d 1473, Tishman argues that Dr. Spiro, in his analysis of Hunio's losses, “included an ‘inflation factor’ for each year to compensate Hunio for the loss of use of his compensation during the back pay period, and to increase projected future losses. Since this is the function of prejudgment interest, if appropriate, and post-judgment interest, it is improper to include such an inflation factor in the calculation, particularly here where Hunio received almost $600,000 in prejudgment interest.”
Yet, a review of the literature and more recent cases indicates that for nonfederal employee actions, most courts hold that the award of prejudgment interest on backpay is in the discretion of the trial court. (Conway v. Electro Switch Corp. (1st Cir.1987) 825 F.2d 593, 602; Hunter v. Allis–Chalmers Corp. (7th Cir.1986) 797 F.2d 1417; Bunch v. Bullard (5th Cir.1986) 795 F.2d 384; Rossein, Employment Discrimination Law and Litigation (Nov. 1992 rev.) § 19.7; Saperstein & Silverman, Wrongful Employment Termination Practice (Cont.Ed.Bar 1987) § 3.54.)
Earlier this year, Division Seven of this district upheld a trial court's determination “that a $450 hourly rate was a reasonable fee for [the attorney's] services based on his ‘knowledge, skill, experience and reputation.’ In setting the hourly fee the court was entitled to consider ‘fees customarily charged by that attorney and others in the community for similar work.’ (Ackerman v. Western Elec. Co., Inc. (9th Cir.1988) 860 F.2d 1514, 1520.)” (Bihun v. AT & T Information Systems, Inc. (1993) 13 Cal.App. 4th 976, 997, 16 Cal.Rptr.2d 787.) The fees in the instant case certainly fall within these parameters.
In view of the incredibly complex nature of the litigation, the protracted trial, and the time expended by counsel in this matter, we can find no abuse of discretion by the trial court in its award of prejudgment interest, attorney fees, and costs.
Hunio suffered significant injury. He is entitled to economic damages as outlined by the experts, to emotional distress damages for humiliation and psychological distress, to punitive damages under applicable state law, and to prejudgment interest and attorney fees as indicated previously. Although, under the present state of the law, we can find no error with the jury's verdicts in this case or the trial court's affirmance of the amounts in issue, it is quite clear to this court that there is a desperate need for legislative action in this regard.
This area of the law is quickly running out of control and the citizens of California will be the ultimate victims and losers. Court-made law, imposed without public hearings or a public debate of the issues, cannot be dictated in this regard by this court. But, it is clear that commerce in California cannot flourish with such multi-million dollar verdicts readily attainable. Legislative caps or limits have been imposed in certain areas of medical malpractice and workers compensation. If the Legislature fails to act in this area, we can see that, in due course, business enterprises will flee the state. It is not our obligation to make the laws, but it is our responsibility to point out where laws are needed.
We also agree with the learned lament expressed by our esteemed colleague, infra.
The judgment is affirmed.
I reluctantly concur. I agree with the majority's analysis and write only to lament the extent to which employees can claim emotional distress because their working conditions are less than ideal. To paraphrase what happened here, the employer created an “intolerable” situation for Hunio by the following: “We'll make him quit by giving him small raises and small bonuses.” (Maybe if they had given him big raises and big bonuses, he would have quit sooner.) Many employees should be so lucky. Only in Wonderland, one would think, could such be considered the creation of an intolerable work situation. But the jury weighed the evidence, and, under the current state of the law, I cannot find a way to conclude there was insufficient evidence.
We all know people who are dissatisfied with their jobs, but who nonetheless stick it out—especially during periods when jobs are hard to come by. We all know someone who has put up with a rough situation for a few years so he can get to his retirement. In California, however, it seems that merely having a good job with good pay is not enough. If the job is not “fulfilling” or does not build the employee's “self esteem,” the employer is somehow derelict, in spite of providing good pay and good benefits. While many employees fully expect to ride high during the good times, they are quick to jump on the emotional distress wagon as soon as the situation takes a downturn.
No one would want to go through a period not knowing from one day to the next whether termination is around the corner. But auto workers and aero-space workers, for example, have gone through years of such distress and have not cracked up, but rather have stuck it out hoping for the best and preparing for the worst. When the worst has happened, most have gotten on with their lives and sought something else. I do not think it is unusual for someone with a long history of employment to have at one time or another worked for a nasty boss. No matter how hard we try, we will never be able to guarantee that a worker will spend a career without having to endure personal animosity from a co-worker or supervisor.
We seem to be on the verge of guaranteeing the right to a “nice and easy” career. I do not see how a company can operate when it must cater to those of such tender sensibilities. Maybe that is one of the reasons some of the companies are moving away. Hunio can live in ease, but a cumulation of this type of litigation promises nothing but ill for employees of companies which can no longer absorb this type of a business cost.
1. Neither Bolsky nor Garron is a party to this appeal.
2. At the time of trial, Government Code section 12921 provided:“The opportunity to seek, obtain and hold employment without discrimination because of race, religious creed, color, national origin, ancestry, physical handicap, medical condition, marital status, sex, or age is hereby recognized as and declared to be a civil right.”Government Code section 12941 provides, in pertinent part:“(a) It is an unlawful employment practice for an employer to refuse to hire or employ, or to discharge, dismiss, reduce, suspend, or demote, any individual over the age of 40 on the ground of age, except in cases where the law compels or provides for such action. This section shall not be construed to make unlawful the rejection or termination of employment where the individual applicant or employee failed to meet bona fide requirements for the job or position sought or held, or to require any changes in any bona fide retirement or pension programs or existing collective-bargaining agreements during the life of the contract, or until January 1, 1980, whichever occurs first, nor shall this section preclude such physical and medical examinations of applicants and employees as an employer may make or have made to determine fitness for the job or position sought or held.“․“(b) This section shall not limit the right of an employer, employment agency, or labor union to select or refer the better qualified person from among all applicants for a job. The burden of proving a violation of this section shall be upon the person or persons claiming that the violation occurred.”
3. Tishman cites Soules v. Cadam, Inc. (1991) 2 Cal.App.4th 390, 3 Cal.Rptr.2d 6 incorrectly. The one incident of harassment in Soules is not equivalent to the pattern of discriminatory treatment in the instant case.
4. Evidence Code section 791 provides:“Evidence of a statement previously made by a witness that is consistent with his testimony at the hearing is inadmissible to support his credibility unless it is offered after:“(a) Evidence of a statement made by him that is inconsistent with any part of his testimony at the hearing has been admitted for the purpose of attacking his credibility, and the statement was made before the alleged inconsistent statement; or“(b) An express or implied charge has been made that his testimony at the hearing is recently fabricated or is influenced by bias or other improper motive, and the statement was made before the bias, motive for fabrication, or other improper motive is alleged to have arisen.”
5. Evidence Code section 1250 provides:“(a) Subject to Section 1252, evidence of a statement of the declarant's then existing state of mind, emotion, or physical sensation (including a statement of intent, plan, motive, design, mental feeling, pain, or bodily health) is not made inadmissible by the hearsay rule when:“(1) The evidence is offered to prove the declarant's state of mind, emotion, or physical sensation at that time or at any other time when it is itself an issue in the action; or“(2) The evidence is offered to prove or explain acts or conduct of the declarant.“(b) This section does not make admissible evidence of a statement of memory or belief to prove the fact remembered or believed.”
6. In view of our decision on the basis of Tishman's failure to properly object, we need not resolve an apparent conflict in the federal cases which permit evidence of an employer's employment pattern and practices relevant to age discrimination (e.g., Abrams v. Lightolier, Inc. (D.N.J.1988) 702 F.Supp. 509, 511) [“Plaintiff is entitled to rely on a discriminatory pattern or practice as indirect evidence of discrimination against him”] and Estes v. Dick Smith Ford, Inc. (8th Cir.1988) 856 F.2d 1097, 1104 [“Evidence of prior acts of discrimination is relevant to an employer's motive in discharging a plaintiff”] and those which hold that such prior history is prejudicial (e.g., Gray v. York Newspapers, Inc. (3d Cir.1992) 957 F.2d 1070, 1082).
7. Code of Civil Procedure section 657 provides, in pertinent part:“The verdict may be vacated and any other decision may be modified or vacated, in whole or in part, and a new or further trial granted on all or part of the issues, on the application of the party aggrieved, for any of the following causes, materially affecting the substantial rights of such party:“․“(5) Excessive or inadequate damages.”
8. At the time of the filing of the original complaint, Civil Code section 3294 provided:“In an action for the breach of an obligation not arising from contract, where the defendant has been guilty of oppression, fraud, or malice, express or implied, the plaintiff, in addition to the actual damages, may recover damages for the sake of example and by way of punishing the defendant.”
9. For example, Tishman cites Mouchette v. Board of Education (1990) 217 Cal.App.3d 303, 266 Cal.Rptr. 1, in which the jury awarded $125,000 to a 62–year–old plaintiff who was discharged after 17 years of service. Hunio cites Weller v. American Broadcasting Companies, Inc. (1991) 232 Cal.App.3d 991, 283 Cal.Rptr. 644, where there was a $1 million award for emotional distress even though the plaintiff was not hospitalized and apparently never saw a doctor regarding his long-term depression, and Watson v. Department of Rehabilitation (1989) 212 Cal.App.3d 1271, 261 Cal.Rptr. 204, where a $1.17 million emotional distress award was upheld in a race/age discrimination case.
ARANDA,* Associate Justice. FN* Assigned by the Chairperson of the Judicial Council.
SPENCER, P.J., concurs.