Phillip Mahnken v. Andrew Bettis Aviation, LLC ( 2020 )

12/21/2020
IN THE COURT OF APPEALS OF TENNESSEE
AT JACKSON
October 7, 2020 Session
PHILLIP MAHNKEN v. ANDREW BETTIS AVIATION, LLC
Appeal from the Circuit Court for Shelby County
No. CT-002666-18 Yolanda R. Kight, Judge
___________________________________
No. W2019-01903-COA-R3-CV
___________________________________
Employee sued his former employer for the compensation that he alleged he was owed
under an employment contract. Following a bench trial, the employee was awarded
damages representing thirty days’ compensation. The employer appeals, arguing that its
nonperformance on the contract was excused by an implied condition. We affirm.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court Affirmed
J. STEVEN STAFFORD, P.J., W.S., delivered the opinion of the court, in which KENNY
ARMSTRONG, and CARMA DENNIS MCGEE, JJ., joined.
William B. Ryan, Memphis, Tennessee, for the appellant, Andrew Bettis Aviation, LLC.
G. Coble Caperton and Warren P. Campbell, Memphis, Tennessee, for the appellee, Phillip
Mahnken.
MEMORANDUM OPINION1
FACTUAL AND PROCEDURAL HISTORY
1
Rule 10 of the Rules of the Court of Appeals of Tennessee provides:
This Court, with the concurrence of all judges participating in the case, may affirm, reverse
or modify the actions of the trial court by memorandum opinion when a formal opinion
would have no precedential value. When a case is decided by memorandum opinion it
shall be designated “MEMORANDUM OPINION,” shall not be published, and shall not
be cited or relied on for any reason in any unrelated case.
On February 6, 2017, Phillip Mahnken (“Appellee”) and Andrew Bettis Aviation,
LLC (“Appellant”) entered into a written employment contract when Appellant hired
Appellee as a pilot. When the parties could not agree on changes to the terms of their
contract, Appellant terminated Appellee without cause. One of Appellee’s owners, David
Turner, notified Appellant of his termination during a phone call on September 20, 2017.
On that same phone call, after Mr. Turner notified Appellee that he was being terminated,
Appellee notified Mr. Turner that he would be “going out on workers’ comp[ensation]”
because of a back condition he was experiencing.2 Mr. Turner then sent Appellee a form
entitled “State of Tennessee Department of Labor and Workforce Development Division
of Employment Security Separation Notice” on September 21, 2017. The Separation
Notice states, in relevant part, that Appellee’s last date of employment, before he was
discharged, was September 20, 2017, and that the reason for the separation was an inability
“to agree on acceptable contract terms regarding continued employment.” Appellee
requested but did not receive wages for the thirty days after Appellant gave him notice of
his termination (i.e., for September 21, 2017 through October 20, 2017).
Appellee then filed a workers’ compensation claim for his back injury. The
“Workers’ Compensation Closed Claim Notice” in the record indicates that the date of
Appellee’s injury was September 20, 2017 and the cause of the injury was repeated lifting
and sitting. The claim notice also indicates that Appellant had “knowledge”—whether that
Appellee filed a workers’ compensation claim or just that Appellee had an injury, it is
unclear—on September 20, 2017, and Appellee made his report to the claims company on
October 2, 2017. Appellee saw a doctor on October 18, 2017 as part of his workers’
compensation claim, at which time the doctor signed a “Work Status Form” that stated:
“Recommended return to work on 10/18/17 with the following limitations: [] Light Work:
Lifting 25 pounds maximum [and] No Flying Pending MRI.” The same form also indicated
an apparent prescription or order for an anti-inflammatory medication, physical therapy,
and an MRI of Appellee’s spine. Appellee saw the same doctor again on October 30, 2017,
when the doctor signed another work status form, which this time had “10/30/17” written
next to “Full Duty (No Restrictions)” under “Work Status.” It appears to be undisputed that
this meant that the Appellee could return to full duty as of October 30, 2017.3
On November 21, 2017 Appellee filed a civil warrant in the Shelby County General
Sessions Court (“the general sessions court”), alleging Appellant failed to pay Appellee the
required wages under their employment contract. On February 26, 2018, Appellant filed
its own civil warrant in the general sessions court against Appellee for reimbursement of
$14,539.94 in training expenses it paid during Appellee’s employment.4 After trial on June
2
At the bench trial in this case, Appellant played a recording of this phone call between Appellee
and Mr. Turner. However, the recording was not itself entered in evidence as an exhibit, nor was it
transcribed in the record.
3
It is unclear from the evidence in the record if Appellee saw this doctor for another visit between
October 18, 2017 and October 30, 2017. He also apparently had an MRI in between those two doctor visits.
4
Appellant attached an itemized reimbursement schedule and an invoice addressed to Appellee
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4, 2018, the general sessions court entered judgment in favor of Appellee on his civil
warrant in the amount of $7,331.88, which the parties do not dispute reflects thirty days of
pay. The general sessions court also entered judgment in favor of Appellee on Appellant’s
civil warrant. Appellant appealed to the Shelby County Circuit Court (“the circuit court”)
on June 7, 2018.5
A second bench trial occurred in the circuit court on September 9, 2019. The only
witnesses to testify were Appellee and Mr. Turner. Mr. Turner testified that he did not learn
of Appellee’s back injury or intent to file a workers’ compensation claim until his phone
call with Appellee on September 20, 2017. In fact, from Mr. Turner’s testimony, it appears
that only after he told Appellee he was fired during that conversation did Appellee then
respond that he was “going out” on workers’ compensation due to his back issues. Mr.
Turner testified, however, that it is Appellant’s policy to take pilots who cannot fly at full
duty off of flight status and not pay them, but offered no documentary proof of this policy.
He also testified unequivocally that regardless of whether Appellee had a disability or not,
he had no intention of requesting Appellee to fly after September 20, 2017, and that he
considered Appellee to be fired effective that date.
Appellee testified that he had been flying with back pain since approximately a few
months after beginning his employment with Appellant, and Mr. Turner confirmed that
there had never been any problems with Appellee’s performance as a pilot. Appellee
testified that he had spoken to his personal doctor about his back pain, but that no doctor
had recommended he be suspended from flying prior to his termination. He testified that
the doctor he saw on October 18, 2017, only recommended that he not fly until he had an
MRI and that he be put on light duty, but that a doctor cannot suspend him from flying,
only the FAA can take that action. He also testified that he had spoken to his immediate
supervisor about his back pain, but, again, Mr. Turner testified that he was not aware of
Appellee’s back injury/workers’ compensation claim until after he had already fired
Appellee.
dated September 28, 2017 to its civil warrant, along with a copy of the parties’ employment contract. The
provision in the employment contract dealing with reimbursement of expenses is in Section 10,
“Termination of Agreement,” and states as follows:
In the event Employee terminates this Agreement, or Employee loses medical
and/or flying authority from the Federal Aviation Administration (FAA), Employee shall
fully reimburse Company upon exit day, of full time employment, for any and all expenses
associated with residential re-location and initial and continuing annual flight training and
education paid by Company. This would include any re-location expenses, training and
flight check cost, airfare, hotel, meals, and salaries paid to employee during the training
period.
5
It appears that Appellant abandoned its claim for reimbursement of training expenses on appeal
to the circuit court. In any event, Appellant has not raised that claim in any form in the instant appeal, and
therefore we need not address it.
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The circuit court also entered judgment in favor of Appellee, on October 3, 2019.
The circuit court’s findings included that the demeanor and testimony of Appellee and Mr.
Turner were credible, and that Appellee was entitled to payment for the thirty days after
his termination in the amount of $7,331.88. Appellant timely appealed to this Court.
ISSUES PRESENTED
The main issue in this case, as raised by both parties, is whether Appellee is entitled
to recover thirty days’ worth of pay from Appellant.6 Appellee raises an additional issue:
whether the appeal filed by Appellant is frivolous. We will address these in turn.
STANDARD OF REVIEW
We review a trial court’s findings of fact de novo with a presumption of correctness,
unless the evidence preponderates otherwise. Tenn. R. App. P. 13(d); see also In re Estate
of Walton v. Young, 950 S.W.2d 956, 959 (Tenn. 1997). “For the evidence to preponderate
against a trial court’s finding of fact, it must support another finding of fact with greater
convincing effect.” Dunn v. Matrix Exhibits, Inc., No. M2003-02725-COA-R3-CV, 2005
WL 2604048, at *2 (Tenn. Ct. App. Oct. 13, 2005) (citations omitted). “The trial court is
in the best position to resolve factual issues that hinge on credibility and an appellate court
will not re-evaluate a trial court’s assessment of a witness’s credibility absent clear and
convincing evidence to the contrary.” Hutchings v. Jobe, Hastings & Assocs., No. M2010-
01583-COA-R3-CV, 2011 WL 3566972, at *2 (Tenn. Ct. App. Aug. 12, 2011) (citation
omitted).
DISCUSSION
I.
This breach of contract action originated when Appellee claimed that under his
employment contract with Appellant he was entitled to, but did not receive, thirty days’
notice of his termination and compensation for those thirty days. The parties stipulated that
paragraph 10 of their contract governs termination without cause. The relevant provision
of paragraph 10 reads as follows:
Without cause, the Company or Employee may terminate this
agreement at any time upon thirty (30) days’ written notice to the other party.
In the event Employee terminates this Agreement, or Employee loses
6
Each party phrases the issue slightly differently in their appellate brief. Appellant asks “whether
Mr. Mahnken is entitled to recover 30 days of pay from Andrew Bettis Aviation, LLC where it was
undisputed that he was physically unable to work, by virtue of disability, for that 30-day period.” Whereas,
Appellee asks if “the trial court err[ed] when it awarded Appellee/Plaintiff thirty (30) days wages from the
Appellant based on the employment agreement between the parties.”
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medical and/or flying authority from the Federal Aviation Administration
(FAA), Employee shall fully reimburse Company upon exit day, of full time
employment, for any and all expenses associated with residential re-location
and initial and continuing annual flight training and education paid by
Company. This would include any re-location expenses, training and flight
check cost, airfare, hotel, meals, and salaries paid to employee during the
training period. Without limitation, termination of Employee pursuant to this
Section 10 shall not relieve Employee of his/her obligations
under Section 6 hereof.
Appellee contends that Appellant breached the above contract when it terminated
his employment without cause but refused to give him the required thirty days’ notice and
thereafter refused to pay him for that thirty-day period. “When a plaintiff alleges breach of
contract, he or she is responsible for proving (1) the existence of an enforceable contract,
(2) nonperformance amounting to a breach of the contract, and (3) damages caused by the
breach of contract.” BancorpSouth Bank, Inc. v. Hatchel, 223 S.W.3d 223, 227 (Tenn.
Ct. App. 2006) (internal quotation marks omitted) (quoting Custom Built Homes v. G.S.
Hinsen Co., Inc., No. 01A01-9511-CV-00513, 1998 WL 960287, at *3 (Tenn. Ct. App.
Feb.6, 1998)).
Appellant does not dispute the existence of the above contract, nor does it dispute
that Appellee’s employment was terminated without cause. Rather than focusing on the
express terms of the contract, Appellant resorts to an implied condition that it asserts is
relevant in this case, citing Jenkins Subway, Inc. v. Jones, 990 S.W.2d 713 (Tenn. Ct.
App. 1998). Specifically, the Jenkins panel held that “[c]ontracts to perform personal acts
are considered as made on the implied condition that the party shall be alive and capable
of performing the contract, so that death or disability, including sickness, will operate as a
discharge, termination of the contract, or excuse for nonperformance.” Id. at 720–21.
According to Appellant, the employment contract qualifies as a personal services contract,
and Appellee does not dispute this. Moreover, Appellant asserts that “because [Appellee]
was not physically able to perform his responsibilities and duties as a pilot due to his
medical disability, under the parties’ employment agreement, [Appellant’s] obligation to
pay [Appellee] during the 30-day notice period following his termination was fully excused
and permissible under Tennessee contract law.”
The trial court, however, rejected Appellant’s argument. Specifically, the trial court
found that Appellant was required to give Appellee thirty days’ written notice of the
termination of his employment and that Appellee was entitled to compensation during that
thirty-day period. Moreover, the trial court found that
[Appellee] was not disabled when he was terminated and [Appellant] didn’t
advise [Appellee] that it considered him to be disabled due to [Appellee]
filing a worker’s compensation claim the day after he was terminated and
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that it needed him to get a medical release to fly. Mr. Turner testified that he
had no intention of calling [Appellee] in to work after his termination on
September 20, 2018.[7] Had [Appellee] been called to perform the services
that he agreed to under the contract, he most likely would have adhered to
the contract terms.
Appellant argues on the appeal that the trial court erred in finding that Appellee was
not disabled during the relevant thirty-day period and that its finding that Appellee was
entitled to an additional thirty days’ pay must therefore be reversed, again relying on
Jenkins. It is true that in the context of personal services contracts, when a party’s
disability prevents him from being able to perform his contractual duties, it operates as a
discharge, termination of the contract, or excuse for nonperformance, unless the parties
contract otherwise. See Cochran v. Robinhood Lane Baptist Church, No. W2004-01866-
COA-R3-CV, 2005 WL 3527627, at *4 (Tenn. Ct. App. Dec. 27, 2005) (citations omitted);
Jenkins, 990 S.W.2d at 720–21 (citations omitted); Am. Nat. Ins. Co. v. Jackson, 12 Tenn.
App. 305, 308–09 (Tenn. Ct. App. 1930), perm. app. denied (Tenn. Feb. 7, 1931) (“A
contract for personal service is terminated by the death, insanity, sickness, or permanent
disability of a servant, whereby he is unable to perform his contract, unless the parties
contracted to the contrary.”). Thus, this general rule is applicable unless the parties provide
otherwise in their contract.
The trial court’s order appears to credit Appellant’s argument that this condition
was indeed applicable and may constitute a proper defense to Appellee’s breach of contract
action. Upon our de novo review of the contract’s terms, however, we are not necessarily
convinced. See Guiliano v. Cleo, Inc., 995 S.W.2d 88, 95 (Tenn. 1999) (“The
interpretation of a contract is a matter of law that requires a de novo review on appeal.”).
While the employment contract is silent as to death of one party, it is not silent as to the
disability of Appellee. Specifically, paragraph 10 of the contract, wherein it provides for
the thirty days’ notice of termination without cause, also states: “In the event . . . Employee
loses medical and/or flying authority from the Federal Aviation Administration (FAA),
Employee shall fully reimburse Company . . . for any and all expenses associated with
residential re-location and . . . training and education paid by Company.” (emphasis added).
This language, as well as its placement in the section of the contract dealing with
termination without cause, leads us to two fairly obvious conclusions: (1) that the contract
specifically deals with the issue of a disability preventing a pilot from flying but does not
excuse Appellant from payment for the thirty-day notice period during this time; and (2)
that such an inability to fly must be determined by the FAA. Because the employment
contract contains an express term regarding the proper method of determining a disability
and its remedy, it appears that it should control over the more general rule supplied by the
common law. Cf. Bradson Mercantile, Inc. v. Crabtree, 1 S.W.3d 648, 652 (Tenn. Ct.
7
We conclude based on the record that this must be a typographical error, and should instead state
that the date was September 20, 2017.
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App. 1999) (“If the contract is plain and unambiguous, the meaning thereof is a question
of law, and it is the Court’s function to interpret the contract as written according to its
plain terms. . . . Courts cannot make contracts for parties but can only enforce the contract
which the parties themselves have made.”).
There can be no question that Appellant cannot meet the express requirement of the
employment contract to show that Appellee was disabled. Appellee confirmed that only
the FAA can suspend him from flying—a doctor cannot. Mr. Turner testified, and Appellee
does not seem to dispute, that under FAA regulations, pilots are obligated to report any
problems they have that would interfere with their pilot duties, including injuries. However,
Appellee testified that he was not required to report this specific injury to the FAA. Indeed,
Mr. Turner conceded that he did not notify Appellee that he needed to report his injury to
the FAA, and there is no proof that the FAA was involved in this case at all. In fact, Mr.
Turner testified that he did not advise Appellee that Appellee would need a medical release
before he would be called to fly “because [Mr. Turner] never intended to call [Appellee]
to fly [after terminating him.]”
Still, Appellant cites Mr. Turner’s testimony that pursuant to Appellant’s policy, if
an employee-pilot reports an injury that could affect their ability to fly, Appellant takes the
pilot off of flight duty until the injury is addressed and there is medical proof that the pilot
is cleared to fly at full duty. Mr. Turner also testified that Appellee “would have” been
removed from flight status and not paid, pursuant to this policy. We cannot conclude that
this testimony changes the result. Here, Mr. Turner provided no documentary proof to
support the existence of this policy, such as an employee handbook, and this policy is
certainly not reflected in the employment contract. The employment contract, however,
contains an integration clause:
This Agreement contains all of the understandings and representations
between the parties pertaining to the subject-matter hereof and supersedes all
other prior undertakings, terms of employment, offer letters, and agreements,
whether oral or in writing, if any. This Agreement may be modified only by
an instrument in writing signed by all the parties.
Mr. Turner’s testimony that Appellant had some unwritten policy concerning disability
therefore does not alter the plain mandate of the contract that only the FAA will be
authorized to determine a pilot’s ability to fly and that the remedy for such a disability is
the reimbursement of certain expenses. Under these circumstances, it appears that nothing
in the plain language of the contract authorized Appellant to deny Appellee payment of
thirty days’ compensation.
Moreover, even assuming, arguendo, that the Jenkins implied condition is
applicable to the employment contract at issue, we conclude that it provides no support for
Appellant’s position. Appellant does not dispute that it terminated Appellee’s employment
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effective September 20, 2017. Mr. Turner testified at trial, and the Separation Notice
confirms, that Appellant intended to terminate Appellee’s employment as of September 20,
2017, the same date Mr. Turner notified Appellee orally of his termination. Mr. Turner also
testified that he “wasn’t going to ask [Appellee] to fly after [September 20, 2017]” under
any circumstances—regardless of whether Appellee was injured or intended to file a
workers’ compensation claim.
Furthermore, the proof showed that the catalyst for the termination was not any
alleged disability, nor did Mr. Turner even know of Appellee’s alleged disability before he
fired Appellee. Mr. Turner testified that he was not aware of Appellee’s intent to file a
workers’ compensation claim for his injury until after he had already terminated Appellee
during their phone call on September 20, 2017. Therefore, the proof is unequivocal that
Appellant intended to terminate, and did terminate, its employment contract with Appellee
on September 20, 2017, without any knowledge or consideration of any alleged disability.
Under these circumstances, Appellee’s ability to fly or perform his contractual
work duties after that date is completely irrelevant—his employment contract had already
been terminated. As the language of Jenkins makes clear, the rule allows for the discharge,
termination, or nonperformance on a contract when death or disability prevents a party
from being “capable of performing the contract[.]” Jenkins, 990 S.W.2d at 720–21. In
other words, Appellant essentially argues that it should be excused from performing under
the contract, i.e., paying thirty days’ compensation because Appellant had a disability that
rendered him unable to perform “his responsibilities and duties” under the contract. The
problem with this argument, however, is that it ignores the fact that it was Appellant who
terminated the employment contract without cause—that is, not based on any purported
disability. In other words, Appellant had already rendered Appellee unable to perform the
contract when it fired him on September 20, 2017. As of that termination, Appellee no
longer had any “responsibilities and duties” to perform. Any attempts to glom Appellant’s
later knowledge of Appellee’s back injury, worker’s compensation claim, and light duty
recommendation onto Appellant’s efforts to reduce the money owed to Appellee are
nothing more than revisionist history. Indeed, the doctor’s recommendation did not even
occur until near the end of the thirty-day period at issue. And Mr. Turner testified
unequivocally that he would not have asked Appellant to return to his duties after firing
him on September 20, 2017, regardless of any alleged disability. Simply put, the facts show
that by terminating Appellee’s employment on September 20, 2017 without cause or
notice, Appellee’s performance under the contract was therein excused. His alleged
inability to perform on the contract thereafter is wholly irrelevant.
In sum, Appellant’s arguments on appeal fail on a number of grounds. Suffice it to
say, Appellant has not shown that it complied with the express terms of the contract or that
its nonperformance of the contract was in any way excused. Therefore, we arrive at the
same conclusion as the circuit court, albeit by way of a different analysis. See Robinson v.
Currey, 153 S.W.3d 32, 40 (Tenn. Ct. App. 2004) (quoting Shutt v. Blount, 249 S.W.2d
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904, 907 (Tenn. 1952)) (“If the Trial Judge reached the right result for the wrong reason,
there is no reversible error.”). Appellee was entitled to thirty days’ notice, and thus pay for
those thirty days, under the express terms of the contract. See Phillips v. Morrill Elec.,
Inc., No. 03A01-9901-CH-00030, 1999 WL 771511, at *5 (Tenn. Ct. App. Sept. 15, 1999)
(citing 27 Am. Jur. 2d, Employment Relationship § 43 (1996)) (“[A]n employee who is
summarily discharged with less notice than specified under the contract may recover
compensation for the notice period only, and not for the balance of the contract period.”).
Therefore, we affirm the trial court’s decision that Appellee is entitled to payment from
Appellant in the amount of $7,331.88.
II.
We next consider Appellee’s request to deem this appeal frivolous and award him
attorney’s fees. Tennessee’s frivolous appeals statute reads as follows:
When it appears to any reviewing court that the appeal from any court of
record was frivolous or taken solely for delay, the court may, either upon
motion of a party or of its own motion, award just damages against the
appellant, which may include, but need not be limited to, costs, interest on
the judgment, and expenses incurred by the appellee as a result of the appeal.
Tenn. Code Ann. § 27-1-122. This Court has previously elaborated on what constitutes a
frivolous appeal:
Successful litigants should not have to bear the expense and vexation of
groundless appeals. An appeal is frivolous when it has no reasonable chance
of success, or is so utterly devoid of merit as to justify the imposition of a
penalty. We exercise our discretion under the statute sparingly so as not to
discourage legitimate appeals.
Whalum v. Marshall, 224 S.W.3d 169, 181 (Tenn. Ct. App. 2006) (citations and quotations
omitted). Our supreme court has described awards of attorney’s fees for frivolous appeals
as follows:
[I]f the appellate court determines that an appeal is frivolous, the appellate
court may award attorney’s fees pursuant to this statute. Any such award rests
in the appellate court’s sound discretion. See Chiozza v. Chiozza, 315 S.W.3d
482, 493 (Tenn. Ct. App. 2009) (“The decision to award damages for the
filing of a frivolous appeal [under section 27-1-122] rests solely in the
discretion of this Court.”). This discretion is exercised “sparingly so as not
to discourage legitimate appeals.” Whalum v. Marshall, 224 S.W.3d 169,
181 (Tenn. Ct. App. 2006).
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Eberbach v. Eberbach, 535 S.W.3d 467, 475 (Tenn. 2017).
Although Appellant’s argument is not in any way persuasive for the reasons
explained above, we still cannot conclude that this appeal was wholly frivolous.
Importantly, Appellant’s brief was fully complaint with Rule 27 of the Tennessee Rules of
Appellant Procedure and its argument, though strained, was supported by appropriate
citations to authority. We therefore decline to find that this was a frivolous appeal.
CONCLUSION
For the foregoing reasons, the judgment of the Circuit Court of Shelby County is
affirmed. Costs of this appeal are taxed to Appellant Andrew Bettis Aviation, LLC, for
which execution may issue if necessary.
S/ J. Steven Stafford
J. STEVEN STAFFORD, JUDGE
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