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24800 - Gastineau v. Murphy and Beaufort County

Davis Adv. Sh. No. 21
S.E. 2d

THE STATE OF SOUTH CAROLINA

In The Supreme Court

James E. Gastineau, Respondent

v.

Leigh Murphy,

Individually, and as

Executive Director of

the Beaufort County

Mental Retardation

Board, the Beaufort

County Mental

Retardation Board

Beaufort County

Council, the State

Department of Mental

Retardation, Defendants,

Of whom

The Beaufort County

Mental Retardation

Board is Petitioner.

ON WRIT OF CERTIORARI TO THE COURT OF

APPEALS

Appeal From Beaufort County

Jackson V. Gregory, Judge

Opinion No. 24800

Heard November 19, 1997 - Filed June 8, 1998

p.21


GASTINEAU v. MURPHY AND BEAUFORT COUNTY

REVERSED

Charles E. Carpenter, Jr., and Deborah Harrison

Sheffield, of Richardson, Plowden, Carpenter &

Robinson, P.A., of Columbia, and James S. Gibson,

of Howell, Gibson & Hughes, P.A., of Beaufort, for

petitioner.

V.M. Manning Smith, of Moss & Kuhn, P.A., of

Beaufort, for respondent.

WALLER, A.J.: We granted certiorari to review the Court of Appeals'

opinion in Gastineau v. Murphy, 323 S.C. 168, 473 S.E.2d 819 (Ct. App.

1996). This is a Whistleblower action in which the Court of Appeals affirmed

the jury's verdict for respondent, James Gastineau (Gastineau), finding he

had been dismissed from his job in retaliation for reporting his employer's

illegal conduct. We reverse.

BACKGROUND/FACTS

In 1988, the General Assembly enacted the South Carolina

Whistleblower Act to protect public employees from retaliation for reporting

violations of law by public bodies or their officials. Act No. 354, 1988 S.C.

Acts 2648 (codified at S.C. Code Ann. §§ 8-27-10 to -50 (Supp.

1989))(amended 1993). At the time Gastineau's claim arose, the Act created

a rebuttable presumption of retaliatory discharge if an employee was

terminated within one year of reporting any violation or wrongdoing. S.C.

Code Ann. § 8-27-30 (Supp. 1989)(amended 1993).1 An employer could rebut

this presumption by showing the employee was discharged for reasons other

than whistleblowing. S.C. Code A-rm. § 8-27-40 (Supp. 1989)(amended 1993);

Gamble v. City of Manning, 304 S.C. 536, 537, 405 S.E.2d 829, 829 (1991).

In this case, Gastineau showed he was fired within one year of

reporting conduct which he believed was illegal. Petitioner. the Beaufort

County Department of Mental Retardation Board (Board), then offered

evidence showing Gastineau was fired for poor job performance.

Furthermore, petitioner offered evidence showing Gastineau could not have

been fired in retaliation for making a report because Gastineau's supervisor


1The 1993 amendment eliminated this presumption.

p.22


GASTINEAU v. MURPHY AND BEAUFORT COUNTY

was unaware of Gastineau's report when she fired him. After the jury

returned a verdict for Gastineau, Board moved for judgment non obstante

veredicto (JNOV). The trial judge refused to grant Board's motion, and the

Court of Appeals affirmed his decision.

ISSUE

Did the Court of Appeals err in denying the Board's motion for JNOV?

DISCUSSION

A motion for JNOV may be granted only if no reasonable jury could

have reached the challenged verdict. Crossley v. State Farm Mutual Auto.

Ins. Co., 307 S.C. 354, 357, 415 S.E.2d 393, 395 (1992). In deciding a motion

for JNOV, the evidence and all reasonable inferences must be viewed in the

light most favorable to the nonmoving party; if more than one inference can

be drawn, the case must be submitted to the jury. Id.

The evidence viewed in the light most favorable to Gastineau shows he

was hired by the Board as a Qualified Mental Retardation Professional

(QMRP) and Residential Director of a facility which housed mentally

handicapped individuals. He began working on April 2, 1990, under the

supervision of Leigh Murphy, Executive Director of the Board.

On July 16, 1990, Gastineau's wife, Christy Gastineau, also began

working for the Board; she was hired as a trainer/driver for the Day Program

at the Beaufort County Rehabilitation Center, a sheltered work program for

the mentally and physically handicapped. Within two weeks of starting her

job, Mrs. Gastineau drove several clients to work at a construction site owned

by Murphy's husband. After seeing the site and asking questions concerning

the clients' wages, Mrs. Gastineau became concerned the clients were working

in unsafe conditions and being underpaid. She voiced these concerns to her

husband. She also confided in her superiors, Barbara Greenberg and Susan

Muckenfuss. According to Mrs. Gastineau, Muckenfuss told Greenberg that

"this is something we need to talk to [Murphy] about."

Two or three weeks later, Gastineau reported Murphy's husband's

possible wage violations to Alice Shook, who worked for the South Carolina

Department of Mental Retardation (SCDMR). Shook repeated Gastineau's

concerns to her immediate supervisor, Wilson Inabinet, and his supervisor,

Brant Coyle. Inabinet and Coyle consequently decided to send a staff

p.23


GASTINEAU v. MURPHY AND BEAUFORT COUNTY

member from SCDMR to review the Day Program in Beaufort. Gary Hudson,

who annually inspected programs licensed by SCDMR and had already

performed his annual inspection of Beaufort's program, was sent back to

Beaufort to perform a follow-up visit.

On October 31, 1990, Murphy discharged Gastineau from his position

as a QMRP. Gastineau subsequently brought this suit alleging he was

discharged in retaliation for whistleblowing. According to Gastineau, he was

fired because he reported Murphy's husband to SCDMR for improperly paying

clients of his facility.

No reasonable jury could have concluded from the evidence introduced

at trial that Gastineau was fired in retaliation for reporting conduct which

he believed to be illegal. First, the evidence viewed in the light most

favorable to Gastineau does not support a finding that Murphy was even

aware of Gastineau's report at the time she discharged him. No direct

evidence was introduced; in fact, Murphy testified she did not leam about

Gastineau's report until November of 1990. Furthermore, the circumstantial

evidence surrounding Gastineau's report is insufficient to find Murphy was

aware of the report.2 According to the Gastineaus, they informed three

people of their suspicions; Gastineau introduced no evidence that any of these

three discussed the Gastineaus' concerns with Murphy.3 One of these three

did convey Gastineau's concerns to two other people, but these two were not

called to testify, and no evidence showed they informed Murphy of

Gastineau's report.

The Court of Appeals held the jury may have inferred that Murphy


2For circumstantial evidence to be sufficient to warrant the finding of

a fact, the circumstances must lead to the conclusion with reasonable

certainty and must have sufficient probative value to constitute the basis for

a legal inference, not for mere speculation. Holland v. Georgia Hardwood

Lumber Co., 214 S.C. 195, 204-205, 51 S.E.2d 744, 749 (1949). The facts and

circumstances shown should be reckoned with in the light of ordinary

experience, and such conclusions deduced therefrom as common sense

dictates; the existence of a fact cannot rest in speculation, surmise or

conjecture. Id.

3In fact, Barbara Greenberg could not recall any complaints Gastineau

or his wife made concerning the safety of clients or their wages, and Susan

Muckenfuss testified neither of the Gastineaus made any complaints to her

concerning client safety or wages.

p.24


GASTINEAU v. MURPHY AND BEAUFORT COUNTY

leamed about Gastineau's report during Gary Hudson's review. 473 S.E.2d

at 824. We disagree.

The jury could not have reasonably inferred Murphy learned of

Gastineau's report from the circumstances of Hudson's inspection. Hudson

died prior to trial and therefore did not testify. Alice Shook testified that

Hudson, who annually inspected programs licensed by SCDMR and had

already performed his annual inspection of this program, was sent to perform

a follow-up visit. Shook did not know what instructions Hudson was given

because she was not present when he was told to go to Beaufort. Shook

testified this type of follow-up visit was not unusual. According to Shook, the

inspector does not notify the program of the impending inspection and does

not tell the program the purpose of the visit. She also testified this type of

visit would normally lead to a written report, and although she searched for

a report, she did not find one.

Viewing the evidence in the light most favorable to Gastineau, the

circumstances under which other inspections were performed do not lead with

reasonable certainty to the conclusion that Hudson would have told anybody

he was there because of Gastineau's report. The evidence does not even

conclusively show that Hudson himself knew he was sent to Beaufort because

of Gastineau's report. The only evidence in the record is that Hudson would

not have revealed the reason for his visit, and that his visit was not out of

the ordinary.

Moreover, to rebut the presumption of retaliation created by the

Whistleblower Act, Board produced overwhelming evidence showing Gastineau

was discharged for failing to fulfill the responsibilities of his job. At trial,

evaluations of Gastineau's job performance after three months and six

months were admitted into evidence. Although Gastineau showed

improvement in some areas during the time between these two evaluations,

the six-month evaluation showed an overall decline in Gastineau's

performance, notably in areas such as quality of work, judgment, planning,

organizing, staffing, and policy implementation. The notes taken by his

supervisor Murphy show Gastineau made frequent financial and payroll

errors and often needed to be reminded of deadlines. The notes also indicate

Gastineau was not fulfilling his responsibility of ensuring compliance with

licensing regulations set out by the Department of Health and Environmental

Control (DHEC).4


4As discussed below, compliance with DHEC regulations is critical

because failure to do so could jeopardize federal funding.

p.25


GASTINEAU v. MURPHY AND BEAUFORT COUNRIY

Gastineau admitted he was struggling with his job due to the amount

of paperwork involved. One of Gastineau's witnesses also confirmed

Gastineau did not get his clerical work done.

Shortly after his six-month evaluation, Murphy I gave Gastineau a

written warning which showed he was not improving despite being

counseled.5The warning noted and Gastineau admitted he took two staff

members on a trip to Walterboro despite being "advised" by Murphy not to

do so. The warning informed Gastineau he could be discharged for another

offense.

Gastineau's termination letter notes he was instructed to review

existing policies and make recommendations for changes, which he admitted

he failed to do. Gastineau also admitted he failed to hold team meetings as

required by federal regulations.

An inspector named Risley Linder testified he conducted a "Quality

Assurance Survey" in August of 1990. This type of review was done as a

practice inspection to help the facility prepare for DHEC certification

inspections. DHEC certification was essential to the facility because without

it, the facility would lose its federal funding which amounted to seventy-five

percent of its budget. In August, Linder found deficiencies in Gastineau's

unit which were serious enough to have affected the program's certification.

Gastineau was notified of these problems during a post-inspection interview

with Linder.

Linder performed a follow-up visit in October. Although some of the

deficiencies had been fixed, Linder found a more alarming problem: a

significant amount of data and progress notes for which Gastineau was

responsible was missing from files. Linder testified this was a more serious

problem for certification than inadequate notes. According to Linder, having

all data and progress notes in the files at all times was critically important

since DHEC did not notify facilities of when it would inspect. Linder

believed the state of Gastineau's records on the day he visited would have

caused DHEC to begin its decertification process.


5Contrary to the dissent's assertion, the fact that Gastineau was made

a permanent employee after his six-month probationary period does not rebut

the Mental Retardation Board's claim that he was subsequently discharged

for "good cause." The uncontradicted evidence is that Beaufort County

personnel policies dictated that employees were automatically given

permanent status after a six month evaluation.

p.26


GASTINEAU v. MURPHY AND BEAUF'ORT COUNTY

Linder's comments dismayed Murphy because they showed Gastineau

was not fulfilling his role as QMRP. Consequently, Murphy and a colleague

took over as acting QMRPs to give Gastineau an opportunity to review all of

his paperwork from the beginning of his job and make sure it complied with

DHEC requirements. When Gastineau failed to do so, Murphy realized he

would never be able to fulfill the role of QMRP, so she discharged him.

Gastineau's termination letter includes a detailed description of his

unsatisfactory work history and was admitted into evidence.

The evidence shows Gastineau was unable to perform his job to the

satisfaction of his supervisors and unwilling to follow directives. Further, his

incompetence was threatening the facility's funding. The only reasonable

inference to be drawn from the evidence is that Gastineau was not fired in

retaliation but for being an unsatisfactory employee. Accordingly, the trial

judge erred in refusing to grant Board's motion for JNOV.

REVERSED.

FINNEY, C.J., and MOORE, A.J., ooncur. TOAL and , JJ., dissenting

in separate opinion.

p.27


GASTINEAU v. MURPHY AND BEAUFORT COUNTY

TOAL, A.J.: I respectfully dissent.

In ruling on motions for a directed verdict or judgment non obstante

veredicto, the trial court must view the evidence and all reasonable inferences

in the light most favorable to the non-moving party, anti if it is susceptible

of more than one reasonable inference, the case should be submitted to the

jury. Unlimited Services, Inc. v. Macklen Enterprises, Inc., 303 S.C. 384, 401

S.E.2d 153 (1991). The majority opinion does not utilize this standard.

Instead, it takes a view of the evidence in the light most favorable to the

Mental Retardation Board. I find that although there was not direct.

evidence offered, there was ample circumstantial evidence presented below to

warrant submission to the jury the. issue of whether Gastineau was

terminated because of his complaint.

Gastineau reported possible safety and wage violations concerning

handicapped clients who worked with the Beaufort County Rehabilitation

Center. He was discharged shortly after his whistleblowing. These violations

related to handicapped individuals who had been hired by the husband of

Leigh Murphy -- the Executive Director of the Mental Retardation Board.

Gastineau informed Alice Shook of the South Carolina Department of Mental

Retardation about the possible violations. Shook, in turn, informed her

supervisors. These supervisors decided to send Gary Hudson to conduct an

inspection of the Rehabilitation Center. Hudson conducted the inspection;

unfortunately, he died prior to trial. No written report of his visit was found.

Furthermore, Gastineau's wife, who worked with the Rehabilitation Center .9

had expressed concerns to her supervisors about the potential violations.

These supervisors, according to Mrs. Gastineau, had stated that they would

discuss the matter with Leigh Murphy.

The circumstances of this case, considered in the aggregate and viewed

in the light most favorable to Gastineau, create a factual issue as to what

Mrs. Murphy knew and whether she fired Gastineau because of his

whistleblowing. The majority is, in effect, acting as a thirteenth juror in

reaching its conclusion, rather than determining if there was sufficient

evidence for the matter to be submitted for the jury.

Moreover, evidence does not support the position that Gastineau was

terminated for good cause. He had been made a permanent employee after

a six-month probationary period. Shortly after becoming a permanent

employee, he was fired. Although his evaluations were below expectations in

some areas, they exceeded expectations in others. Yet, he was suddenly

terminated after he disclosed the potentially damaging information about the

p.28


GASTINEAU v. MURPHY AND BEAUFORT COUNTY

handicapped clients. The Mental Retardation Board cannot grant Gastineau

a permanent position, based on his employment record, and at the same time

claim to fire him for "good cause" on the basis of the identical record.6

I would affirm the Court of Appeals' affirmance of the trial court's

ruling. This was clearly a case for the jury to decide. I would uphold its

verdict of $375,000 in favor of Gastineau. No challenge is made to the

amount awarded.

BURNETT, A. J. , concurs.


6 In footnote 5 of its opinion, the majority asserts that Beaufort County

personnel policies dictated that employees were "automatically" given

permanent status after a six-month evaluation. There is no record citation

to support this statement. This statement overlooks the fact that by

definition a "probationary period" implies not automatic employment, but

rather employment conditioned upon demonstration of fitness for a job. If

Gastineau's record was as bad as was claimed, then surely he would not have

been able to meet the requirements of his probationary period. He was

evaluated shortly before the end of his six-month probationary period; he

became a permanent employee at the six-month point; and he was terminated

thereafter. The fact that the majority and dissent see these facts differently

illustrates dramatically why this matter is a question of fact to be resolved

by a jury.

p.29