Deck 17: Employee Health and Safety

Question 1

Explain how Mr. Grappolini breached his fiduciary duty.

Answer 1

Mr. Grappolini breached his fiduciary duty by obtaining a special supply contract with Vegetal for the Grappolini Business instead of for Lucini. It was an disloyal act which resulted in substantial loss for Lucini and the promotional activities were rendered useless due to non-release of its product in time.

Question 2

What is the "motivation test," and does this court accept or reject it?

Answer 2

The " motivation test " determines whether an action performed by an employee was motivated by business consideration or personal consideration.
Under the Minnesota rule, liability can only be imposed on the employer where it is shown that "the employee's acts were motivated by a desire to further the employer's business." Therefore an employer can only be found liable for an employee's assault when the employer actually asked the employee to perform so.
The fault in this test is that, it hard to determine whether the assault was made for business reasons or it had been done in personal purpose under disguise of the scope of the duty. But this is not the relevant argument in this case, what is relevant here is whether the assault occurred within work related limits of time and place and is it a case of negligence in supervising. Therefore, the court rejected the test.

Question 3

What lessons can you learn about contracts, suppliers, and product launches from the case?

Answer 3

The lesson which can be learnt from this case is that paper work in case of business dealings is must and should be done swiftly. The middlemen should not be trusted with vital dealings and management should keep control and observation over their activities. They should also clear the process before making promotional expense on a dream project beforehand.

Question 4

What is the general position of the courts on the liability of churches and dioceses for the sexual misconduct of priests?

Question 5

Explain why the court decided to award both lost profits and punitive damages.

Question 6

What must a plaintiff allege to be able to recover from a church or diocese?

Question 7

Dr. Warren Lesch had a leak in his car's gas tank that had been repaired by Malcolm Weeks, an employee of Walker's Chevron, Inc., in Bel Air, Maryland. The tank was not repaired properly, and Dr. Lesch's home and garage were destroyed when the gas tank exploded. Dr. Lesch and his wife were severely burned as a result.
Walker's Chevron is a "branded" station: It displays only Chevron signs and colors and sells only Chevron gas and oil. The Lesches have sued Mr. Weeks, Walker's Chevron, and Chevron USA. Who is liable for the explosion? [ Chevron USA, Inc. v Lesch, 570 A.2d 840 (Md. 1990)]

Question 8

Evaluate the ethics of Mr. Grappolini's conduct. Why did Vegetal's officers refer to Mr. Grappolini as a "bad boy"?

Question 9

What must a plaintiff prove to be able to recover from a church or diocese?

Question 10

On September 29, 1984, Wilton Whitlow was taken to Good Samaritan Hospital's emergency room in Montgomery County, Ohio, because he had suffered a seizure and a blackout. He was examined by Dr. Dennis Aumentado, who prescribed the anti-epileptic medication Dilantin. Mr. Whitlow experienced no further seizures and was monitored as an outpatient at Good Samaritan over the next few weeks.
Mr. Whitlow complained to Dr. Aumentado of warm and dry eyes, and his Dilantin dose was reduced. On October 20, 1984, he was again admitted to the emergency room with symptoms that were eventually determined to be from Stevens-Johnson syndrome, a condition believed to be caused by a variety of medications. Mr. Whitlow sued Dr. Aumentado and Good Samaritan for malpractice and Parke-Davis, the manufacturer of Dilantin, for breach of warranty.
The hospital maintains it is not liable because Dr. Aumentado was an independent contractor. Is the hospital correct? [ Whitlow v Good Samaritan Hosp., 536 N.E.2d 659 (Ohio 1987)]

Question 11

What did Ms. Coady agree to when she became a Harpo employee?

Question 12

Is there liability for negligent supervision of priests?

Question 13

On March 29, 1983, Barry Mapp was observed in the JCPenney department store in Upper Darby, Pennsylvania, by security personnel, who suspected that he might be a shoplifter. Michael DiDomenico, a security guard employed by JCPenney, followed Mr. Mapp when he left the store and proceeded to Gimbels department store. There, Mr. DiDomenico notified Rosemary Federchok, a Gimbels security guard, about his suspicions. Even though his assistance was not requested, Mr. DiDomenico decided to remain to assist in case Ms. Federchok, a short woman of slight build, required help in dealing with Mr. Mapp if he committed an offense in Gimbels. It came as no surprise when Mr. Mapp was observed taking items from the men's department of the store; when he attempted to escape, he was pursued. Although Ms. Federchok was unable to keep up, Mr. DiDomenico continued to pursue Mr. Mapp and ultimately apprehended him in the lower level of the Gimbels parking lot. When Ms. Federchok arrived with Upper Darby police, merchandise that had been taken from Gimbels was recovered. Mr. Mapp, who had been injured when he jumped from one level of the parking lot to another, was taken to the Delaware County Memorial Hospital, where he was treated for a broken ankle.
Mr. Mapp filed suit against Gimbels for injuries sustained while being chased and apprehended by Mr. DiDomenico. He alleged in his complaint that Mr. DiDomenico, while acting as an agent of Gimbels, had chased him, had struck him with a nightstick, and had beaten him with his fists. Gimbels says it is not liable because Mr. DiDomenico was not its agent. Is Gimbels correct? [ Mapp v Gimbels Dep't Store, 540 A.2d 941 (Pa. 1988)]

Question 14

Does it matter whether the covenant was part of the employee manual or part of a contract?

Question 15

What is the effect of the disclaimer in the Jogbra employment manual?

Question 16

Nineteen-year-old Lee J. Norris was employed by Burger Chef Systems as an assistant manager of one of its restaurants. On a day when he was in charge and change was needed, Mr. Norris left to get change but also decided to get Kentucky Fried Chicken at a nearby store for his lunch to take back to Burger Chef. The bank where Mr. Norris usually got change is 1.6 miles from Burger Chef, and the Kentucky Fried Chicken outlet is 2.5 miles from Burger Chef. After Mr. Norris left the bank and was on his way to the Kentucky Fried Chicken restaurant, he negligently injured Lee J. Govro in an accident. Is Burger Chef liable for the accident? [ Burger Chef Systems v Govro, 407 F.2d 921 (8th Cir. 1969)]

Question 17

Is there a difference between a confidentiality agreement and a covenant not to compete?

Question 18

What is the importance of an ambiguity?

Question 19

CAA is a Hollywood talent agency that represents sports figures. IMG Worldwide is its major competitor. Over the past two years, IMG agents Casey Close and Tom Condon have left their jobs and been hired by CAA. Shortly after their departure, IMG clients Derek Jeter, Tony Gonzalez, and LaDainian Tomlinson left IMG for CAA. In April 2010, Matthew Baldwin, a junior agent at IMG in Ohio, left his $90,000-per-year job and joined CAA. Mr. Baldwin also moved to California. IMG has filed suit against both Mr. Baldwin and CAA for violation of Mr. Baldwin's noncompete clause. The clause, which is part of a contract Mr. Baldwin signed when he was hired by IMG in Ohio, prohibits him from moving to a competing talent firm for a one-year period. IMG's suit also alleges that Mr. Baldwin took 7,000 confidential files from IMG when he left. Mr. Baldwin has denied the allegations, maintaining that his computer contained only personal information he had gathered from public records on coaches, salaries, and teams. CAA has responded to the suit by citing the California statute that makes covenants not to compete unenforceable. IMG has responded by noting that Ohio law, not California law, applies and that California's law does not apply when a former employee has take confidential information from company files to his new employer. Evaluate the enforceability of the covenant not to compete. Be sure to think back to Chapter 3 and discuss which court would have jurisdiction and which law would apply. Why is it important to determine which law applies?

Question 20

Does this restrictive covenant prevent Ms. Coady from working as a journalist?

Question 21

Why is there no promissory estoppel claim?

Question 22

Reverend John Fisher is the pastor of St. James Episcopal Church in Ohio. Catherine Davis served there as parish secretary from 1978 until six months after Reverend Fisher arrived at St. James in January 1988. Reverend Fisher fired her after she went to the bishop of the diocese to complain about sexual harassment by Reverend Fisher. The bishop promised an investigation, which was not conducted because Reverend Fisher denied the allegations. Ms. Davis then brought suit against the Episcopal Diocese. The diocese denied liability, claiming it was not in control of Reverend Fisher's actions because he was an independent contractor. Do you agree? [ Davis v Black, 591 N.E.2d 11 (Ohio 1991)]

Question 23

Of what significance is the fact that Mr. Theurer volunteered for the all-night shift?

Question 24

What changes the application of the employment-at-will doctrine to Dillon?

Question 25

Lennen Newell, Inc. (L N), is an advertising agency hired by Stokely-Van Camp to do its advertising. L N contracted for the purchase of ad time from CBS, but no Stokely representative's signature is on the contract. If L N does not pay for the ad time, is Stokely liable? [ CBS, Inc. v Stokely-Van Camp, Inc., 456 F Supp. 539 (E.D.N.Y. 1977)]

Question 26

Why would a restaurant association have an interest in the outcome of the case?

Question 27

What is the dissenting justice's concern?

Question 28

John Guz, 49, first hired in 1971, had worked for Bechtel Corporation for 22 years. In 1986, he was assigned to BNI, a division specializing in engineering, construction, and environmental remediation that focuses on federal government programs, principally for the Departments of Energy and Defense (BNI-MI). Mr. Guz worked his way up through Bechtel and BNI both, going from administrative assistant, beginning at a salary of $750 per month, to financial reports supervisor, earning $70,000 per year. During his time with Bechtel and BNI, Mr. Guz had been given generally favorable performance evaluations, steady pay increases, and a continuing series of promotions.
During this time, Bechtel maintained Personnel Policy 1101, dated June 1991, on the subject of termination of employment (Policy 1101). Policy 1101 stated that "Bechtel employees have no employment agreements guaranteeing continuous service and may resign at their option or be terminated at the option of Bechtel."
Between 1986 and 1991, BNI-MI's size was reduced from 13 to 6 persons, and its costs were reduced from $748,000 in 1986 to $400,000 in 1991. Bechtel eventually eliminated Mr. Guz's division. Mr. Guz was discharged, as were all the employees in the division. Mr. Guz brought suit against Bechtel alleging that he had an "implied-in-fact contract" with Bechtel that prevented the company from terminating him as long as the company was performing well financially.
The trial court granted Bechtel's motion for summary judgment and dismissed the action. In a split decision, the Court of Appeal reversed. Bechtel appealed. Who should prevail on appeal? [ Guz v Bechtel, 8 P3d 1089 (Cal. 2000)]

Question 29

Did McDonald's violate any Oregon statute?

Question 30

Why is this case different from one in which an employee "rescues" a member of the public from fraud in bids or injury from defective products?

Question 31

Bernice Bisbee is a real estate broker employed by Midkiff Realty, Inc. In September 1972, she obtained from Richard and Marian Silva an exclusive listing agreement for the sale of their property in Kaleheo, Kauai. The land, which fronted on the Kaumualii highway, consisted of 34,392 square feet, one twobedroom house, and one four-bedroom house. The Silvas told Ms. Bisbee that they wanted $100,000 for the property.
Some time later, Ms. Bisbee obtained an offer for the property from David Larsen. The down payment was set at $35,000, with payments of $2,000 a month at 8 percent a year, but Mr. Larsen backed out before closing. After that, a joint venture of six members formed the Pacific Equity Associates to buy the property. Ms. Bisbee was to manage the joint venture and would receive 10 percent of the profits for her services. One of the joint venture members, Toshio Morikawa, appeared as the buyer at the July 1973 closing of the property sale. Ms. Bisbee did not tell the Silvas of the venture nor of her pecuniary interest in it.
In August 1973, Ms. Bisbee prepared for the venture a financial statement that listed the market value of the Silva property at $149,424. Several times the venture was late making payments, which Ms. Bisbee covered. Mr. Silva and his wife were emotionally distressed about the late payments and told Ms. Bisbee. Eventually, because of defaults on the payments, the Silvas brought suit to cancel the contract and for damages for fraud by Ms. Bisbee, naming Midkiff Realty in the suit as well.
The jury returned a verdict for $29,000 in general damages for the Silvas and $50,000 in punitive damages. Ms. Bisbee and Midkiff appealed. Was there a breach of fiduciary duty? Should the damage award stand because of Ms. Bisbee's actions? [ Silva v Bisbee, 628 P2d 214 (Haw. App. 1981)]

Question 32

Was Mr. Theurer acting within the scope of employment?

Question 33

Did Mr. Gardner do the right thing in leaving his truck unattended? What were his ethical obligations under the circumstances? What would you have done?

Question 34

Recovery Express and Interstate Demolition (IDEC)are two Boston-based companies with the same business address. Albert Arillotta, who claimed to be a partner at IDEC, sent an e-mail to Leo Whitehead of CSX Transportation about purchasing rail cars for scrap purposes. The e-mail came from [e-mail]. The two reached an agreement, and Arillotta went to the CSX yard and disassembled rail cars and hauled them away. Mr. Whitehead sent invoices to IDEC for $115,757.36 because he believed Arillotta to be an agent for IDEC and Recovery Express. IDEC has no assets and CSX seeks to recover the amount due from Recovery Express. Recovery Express's CEO said he just allowed IDEC, a new company, to share office space and the e-mail server. Mr. Whitehead says that he assumed from the e-mail and the same address that Arillotta was an agent for Recovery as well. Who is liable? [ CSX Transportation, Inc. v Recovery Express, Inc., 415 F. Supp.2d 6 (D. Mass. 2006)]

Question 35

Is McDonald's liable to Mr. Faverty?

Question 36

Does this case create any affirmative legal duty to help those in danger?

Question 37

What did the CEO of the corporation do to a third party? Is Grease Monkey liable to the Montoyas?

Question 38

What counterpoints does the dissenting judge make?

Question 39

Can an employee in Washington be fired for assisting a citizen who is a crime victim?

Question 40

What is the purpose of the apparent authority doctrine?

Question 41

What previous indications did Nabisco have that Mr. Lynch might cause some problems?

Question 42

What duties does apparent authority impose on principals?

Question 43

What test does the court give for determining scope of employment?