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Firing Pflugrad, O'Day Will Cost UM at least $147,000
- Thread starter Ursa Major
- Start date
Of course, he doesn't know as much as Jackie Chiles. 
GrizBacker04 said:
I disagree. O'Day's contract appears to have automatically renewed due to the 5-mos. notice provision. Thus, he appears to be owed salary through June 2013. Pflu's argument is that the U and O'Day promised him a two-year extension and new contract, and that he and others relied on that. It will be interesting to see exactly what was said, and said in writing (like in emails). MT courts tend to accept oral contracts easier than most jurisdictions, and have been known to declare that non-binding letters of intent are binding. While the U would argue that the BOR have to approve contracts, the lawyers for Pflu would argue that O'Day has the authority to act on behalf of and bind the university. A company can't hide behind the fact that the board didn't approve a contract when senior vp or ceo approved or entered into the contract. There is alot of national case law involving situations like that. Again, I still wonder if the new MT sup ct case law results in the university form of contract, with a no-fault termination provision, being invalid--and thus subject to the Mt wrongful termination laws. Engstrom can keep quiet now, but if he's ever deposed, he will have to say exactly why the two were terminated.
goatcreekgriz
Well-known member
The arbitration clause is unambiguous, does not violate public policy, and should be enforceable. UM has good defenses (though few defenses are ever a lead-pipe cinch) if contract payments are made through the end of the contract terms and mouths remain zipped. There is a duty to mitigate damages. These are not big-dollar cases. Arbitrators often just split the baby. Finally, any negotiated settlement, or award if no settlement is reached, will be public -- so we'll have the chance to find out what really happens. I'm more interested in how April 14 goes.
goatcreekgriz said:
I don't think your statement is quite as strong as you think. Arbitration clauses can be attacked in a various of ways. Adhesion, public policy, etc. See below except from a 2009 MT CLE. Note the speicific reference to employment contracts.
Recent Montana Arbitration Cases
A. Unenforceable Contracts of Adhesion
• In Montana an arbitration provision contained in a
consumer or nonunion‐management employment
contract is not enforceable if:
• (1) the arbitration provision is adhesive (form contract
& take‐it‐or‐leave‐it), and (2) if adhesive, it is not
enforceable if:
Procedural ‐ (a) the provision was not within the reasonable
expectation (based on totality of circumstances with
voluntary, knowing and intelligent waiver of right to jury
trial and all included process) of the weaker party, or
Substantive ‐ (b) if within the reasonable expectation of the
weaker party, the arbitration provision was “unduly
oppressive, unconscionable or against public policy.”
http://umt.edu/law/faculty/corbett/2009%20Employment%20Law%20CLE%20slides.pdf" onclick="window.open(this.href);return false;
goatcreekgriz said:
Here's another argument. The arbitration provision, which is in the existing employment contract, would not apply to the separate and recent oral agreement to enter into a new 3-year contact, i.e. the oral agreement between the U/O'Day and Pflu. Or some various of that argument.
Quick question. Doesn't the BOR have to approve the contracts of the Athletic Director and the Head Coach? If that is the case, then at no point could a verbal agreement for a contract from the AD to the Head Coach be a binding to the Montana University System as the AD has no authoritative power to do so.
Here's the 2011 MT Sup Ct case that I have been mentioning, as something that could invalidate the university's form of employment contract that has a provision allowing an employee to be terminated without cause (and thus allowing the employee to bring an action under Montana wrongful termination provisions under the MT employment act and related case law. I would think this could also result in arbitration provisions not being enforceable. Here is a blurb from a newspaper article.
"Until recently, many lawyers felt that any type of written contract of employment would pass muster under the WDEA. So, they started drafting agreements that basically gave the employers the option of terminating the employment contract for no cause with little (or no) notice to the employee. The contract in Brown was one such contract. On its face, it looked like a three-year employment contract. In the details, however, was a provision saying that it could be terminated by either party, without cause, on 30 days' notice.
In accordance with the terms of the employment agreement, Brown was terminated from his employment. Rather than go quietly into the night, he sued his employer. Initially, the trial court dismissed the case saying that Brown's agreement was "a written contract of employment for a specific term" within the meaning of the WDEA. Brown appealed to the Montana Supreme Court."
Read more: http://billingsgazette.com/article_11d23bb1-2b11-5d6b-89fc-be09b681c34e.html#ixzz1rI5htllx" onclick="window.open(this.href);return false;
http://billingsgazette.com/article_11d23bb1-2b11-5d6b-89fc-be09b681c34e.html" onclick="window.open(this.href);return false;
"Until recently, many lawyers felt that any type of written contract of employment would pass muster under the WDEA. So, they started drafting agreements that basically gave the employers the option of terminating the employment contract for no cause with little (or no) notice to the employee. The contract in Brown was one such contract. On its face, it looked like a three-year employment contract. In the details, however, was a provision saying that it could be terminated by either party, without cause, on 30 days' notice.
In accordance with the terms of the employment agreement, Brown was terminated from his employment. Rather than go quietly into the night, he sued his employer. Initially, the trial court dismissed the case saying that Brown's agreement was "a written contract of employment for a specific term" within the meaning of the WDEA. Brown appealed to the Montana Supreme Court."
Read more: http://billingsgazette.com/article_11d23bb1-2b11-5d6b-89fc-be09b681c34e.html#ixzz1rI5htllx" onclick="window.open(this.href);return false;
http://billingsgazette.com/article_11d23bb1-2b11-5d6b-89fc-be09b681c34e.html" onclick="window.open(this.href);return false;
goatcreekgriz
Well-known member
It's an argument, though I do not think it is persuasive. The question is whether the dispute arises under the agreement. But for the contract with the broad arbitration clause, there would be no relationship between the parties and likely no issue of any duty or breach of duty. The whole issue of whether the WDEA applies involves interpretation of the agreement. That being said, the MT SCT has at times read arbitration clauses narrowly and I see no basis for federal jurisdiction (the Federal Arbitration Act is brutal on parties trying to avoid arbitration clauses), unless regulation of intercollegiate athletics somehow gives rise to a federal question (and I am totally clueless on that angle, though it seems unlikely). I still think the biggest problem with the oral contract approach is the statute of frauds, which still means something, unless detrimental reliance can be proven. My guess is that if a bonafide job offer from somewhere else had been on the table, then a written contract extension would have negotiated and executed prior to anyone turning down that job offer. I do not pretend to know all the facts here, but the University of Montana is about much more than football and it seems likely (to me) that a legitimate business reason existed for any alleged termination.
goatcreekgriz said:
If there was to be a new 3-year contract, then there's a good argument that the dispute isn't under the existing contract and that arbitration clause isn't applicable. I think Pflu did have one or more other opportunities to move on, and didn't pursue or take it, by the way
goatcreekgriz
Well-known member
The Brown case did not invalidate the entire employment contract at issue, but held that the termination without cause provision precluded the contract from being a“written contract of employment for a specified term” under MCA § 39-2-912(2), thereby allowing for WDEA remedies. The holding makes sense, but I do not believe the Brown case supports invalidating the arbitration clause.
goatcreekgriz
Well-known member
It's an argument (re arbitration), though I think it's weak. If Pflu can demonstrate detrimental reliance, then he has a shot at proving more in damages. He still has to mitigate, and he is a talented coach, so I still do not believe UM has significant exposure. We'll see.
I think this provides some guidance as well:
"The present case also does not involve the right of an employer to not renew an employment contract which has expired. See e.g. Solle v. Western States Ins. Agency, 2000 MT 96, 299 Mont. 237, 999 P.2d 328; Farris v. Hutchinson, 254 Mont. 334, 838 P.2d 374 (1992)."
"The present case also does not involve the right of an employer to not renew an employment contract which has expired. See e.g. Solle v. Western States Ins. Agency, 2000 MT 96, 299 Mont. 237, 999 P.2d 328; Farris v. Hutchinson, 254 Mont. 334, 838 P.2d 374 (1992)."
goatcreekgriz
Well-known member
Last thing, and I'll quit beating this dead horse. Even assuming there was some sort of oral deal, any writing to confirm the deal would likely have included an arbritration clause. Cuts both ways.
goatcreekgriz said:
I think Brown wholly invalidates the arbitration clause. In short, the Brown court said that an employment contract that allows for at will employment (ie: being fired without cause) allows the fired individual to seek remedies under the wrongful discharge act. The wrongful discharge act does not require arbitration. I'm not sure what the max remedies are under the wrongful discharge act but I think its limited to about 3 years of pay. to those who say they were not "fired" I sugest you look at the contract. If the contracts were simply going to be non-renewed, Pflu would be coaching right now and O'day would be AD'ing. There are two sides to every case, but in this one, I certainly would not want to be on the U's side. I presume the U will be writing a couple of large checks....
Here is Court's own words:
The significance of these cases to the present issue is that they all conclude that the at-will provision of the contract “trumps” the definite employment term, so that such a contract is construed to not be one for a definite or specific term. We construe the “specific term” language of § 39–2–912, MCA, the same way. If an employment contract for a specific term also allows the employer to terminate at will (after completion of the probationary period), it is not a “written contract for a specific term” under that statute. A discharged employee covered by such a contract is not excluded by § 39–2–912, MCA, from bringing a claim under the Wrongful Discharge from Employment Act.
¶ 12 Construing the employment agreement in this case as one for a specific term would remove the discharge from the Act; could effectively reinstate at-will employment in Montana, and would leave the discharged employee arguably without remedy. He would not be able to bring an action under the Act, and at the same time would be subject to the employer's contractual right to discharge at will. Such a result would be contrary to the weight of authority and would undermine the purposes of the Act.
Brown v. Yellowstone Club Operations, LLC 361 Mont. 124, 128, 255 P.3d 205, 208 (Mont.,2011)
