WPC 3# UN %3 0 (9w@a4 0@ 0l 0Dp 0J 0T 0^R 0h 0r 0| 0 0 1u 0d U> B)3 B\ D3y DC AM U*< f h _V AQ? 0D 0DI D/ Biv~{vHP LaserJet 4SiHPPCL5MS,,,,,,0nLH(hH  Z 6Times New Roman RegularX($ U Ӏ zz!3|x ("$    ((3$ !      0  (#$  0  2 0Indent123  2" 0Indent20 23  2, 0Indent30 0 23  26 0Indent40 0 0 23  2@ 0Indent50 0 0 0 23  2J 0Indent60 0 0 0 0 23  2T 0Indent70 0 0 0 0 0 23  2^ 0Indent80 0 0 0 0 0 0 23   ?AGMSYaioIndent0I.A.1.a.(1)(a)i)a)P 8Mac DefaultMac Default ` X<  9p`(&Times New Roman% Line 7 d d 'dxd7Border 1dd*"C << G<  9p`(Arial !  +"  $$   YYY FILED$X June2,1997CecilCrowson,Jr.$AppellateCourtClerk   !   $       See U.S.Const.amends.V,XIV;42U.S.C.1983(1988); seealso Tenn.Const.art.I,8.TheEmployeesinitialcomplaintsdidnotincludethesedueprocessclaims,buttheEmployeeslatersoughttoaddtheseclaimsbyfilingmotionstoamendtheircomplaints.ThetrialcourtsorderseffectivelygrantedtheEmployeesmotionstoamend. !   $       ThetrialcourtspecifiedthatWilliamsreinstatementwascontingentuponWilliamsformerpositionbecomingavailable. !   $       See T.R.A.P.16(b).*+,-C<< CLevel 1Level 2Level 3Level 4Level 5(3$ !  ($$   1  ..' dxdP Pd  !   $       See  Smithv.Morris ,778S.W.2d857(Tenn.App.1988)(compensationforaccumulatedunusedsickleave); Williamsv.MaremontCorp. ,776S.W.2d78(Tenn.App.1988)(recallprovision); Hambyv.Genesco,Inc. ,627S.W.2d373(Tenn.App.1981)(rollbackprovision); seealso  Claibornev.FritoLay,Inc. ,718F.Supp.1319(E.D.Tenn.1989)(seniorityprovision); MacDougalv.Sears,Roebuck&Co. ,624F.Supp.756(E.D.Tenn.1985)(serviceallowance).  !   $       See  Bringlev.MethodistHosp. ,701S.W.2d622(Tenn.App.1985); Gravesv.AnchorWireCorp. ,692S.W.2d420(Tenn.App.1985); Whittakerv.CareMore,Inc. ,621S.W.2d395(Tenn.App.1981); seealso  Gregoryv.Hunt ,24F.3d781(6thCir.1994); Davisv.ConnecticutGen.LifeIns.Co. ,743F.Supp.1273(M.D.Tenn.1990).PtPtHH(FG(HH(d'hStyl{WP}01  HH  2$HH  Geneva  <Px443!#4$*$$*$ KK  Geneva  Geneva .,6 Geneva   h HD: Geneva  h HD: Geneva ! .   \RA'\` ` pX\RA'\ @ INTHECOURTOFAPPEALSOFTENNESSEE,WESTERNSECTION@ ATJACKSON @ _______________________________________________________ ) JERRYWILLIAMS , ) ShelbyCountyCircuitCourt,*R#%"A1-j|=`  `@R ) No.52045T.D.T̀Plaintiff/Appellee. )  )VS. ) C.A.No.02A019608CV00190 ) MEMPHISHOUSINGAUTHORITY,  )  ) ̀Defendant/Appellant. ) )______________________________________________________________________________ MABLEMONDAY , ) ShelbyCountyCircuitCourt ) No.51932T.D.̀Plaintiff/Appellee. ) )VS. ) C.A.No.02A019610CV00231 ) MEMPHISHOUSINGAUTHORITY , ) )̀Defendant/Appellant. )______________________________________________________________________________FromtheCircuitCourtofShelbyCountyatMemphis. HonorableWyethChandler,Judge GregoryL.Perry AttorneyforDefendant/Appellant. AlanBryantChambers , JeffA.Crow,Jr. CHAMBERS,CROW,DURHAM&HOLTON,LAWYERS,Memphis,TennesseeAttorneyforPlaintiffs/Appellees.OPINIONFILED: REVERSEDANDREMANDED  FARMER,J. HIGHERS,J. :(Concurs) LILLARD,J. :(Concurs)  ` ` X DefendantMemphisHousingAuthority(MHA)appealsseveralordersenteredbythetrialcourtinfavoroftwoofMHAsformeremployees,Plaintiffs/AppelleesJerryD.WilliamsandMableMonday(collectively,theEmployees).Inseparateactionsfiledbelow,theEmployeessuedMHAforbreachofemploymentcontract.Inbothcases,thetrialcourtenteredordersgrantingtheEmployeesmotionsforsummaryjudgmentbasedonthecourtsconclusionthatMHAsManualofOperationsconstitutedpartoftheemploymentcontractbetweenthepartiesand,further,thatMHAbreachedthiscontractbyterminatingtheEmployeeswithoutjustcause.Amendingthepleadingstoconformtotheproofintherecords,thetrialcourtsforegoingordersalsograntedsummaryjudgmenttotheEmployeesontheirclaimsthat,interminatingtheEmployees,MHAviolatedtheirrightstosubstantiveandproceduraldueprocess. &   ׀Afterconductingasubsequenthearingontheissueofremedies,thetrialcourtenteredfinalordersgrantingtheEmployeesbackpayandreinstatementtotheirformerpositionswithMHA. '   ׀UponMHAsmotion,thiscourtconsolidatedMHAsappealsofthetrialcourtsjudgmentsinfavorofWilliamsandMondaybecausetheappealsinvolvecommonquestionsoflawandfact. (    Onappealfromthetrialcourtsfinaljudgments,MHAcontendsthatthetrialcourterredin(1)permittingtheEmployeestoamendtheircomplaintstoassertclaimsforsubstantiveandproceduraldueprocessviolations;(2)grantingtheEmployeesmotionsforsummaryjudgment;(3)awardingtheEmployeesbackpayandreinstatement;and(4)denyingMHAsmotionsforleavetorenewitsmotionsforsummaryjudgment.Weconcludethataresolutionofthesecondissueisdispositiveofthisappeal,andwereversethetrialcourtsjudgments. ForpurposesoftheEmployeessummaryjudgmentmotions,thepartiesstipulatedtothefollowingfacts.MHAhiredMondayforthepositionofExecutiveSecretaryinSeptember1989.WilliamswashiredasMHAsDirectorofSecurityinApril1991.MHAsoperationispartiallygovernedbyfederallawandbyfederalrulesandregulationsimplementedbytheUnitedStatesDepartmentofHousingandUrbanDevelopment(HUD).BetweenNovember1991andFebruary1992,HUDsdistrictareaofficeinNashvilleconductedaComprehensiveCoordinatedManagementReviewofMHA.Asaresultofthisreview,HUDissuedareportinMarch1992whichconcludedthatWilliamsandMondayhadbeenimproperlyhiredinthattheiremploymentapplicationswerenotsubmittedwithintheadvertisedtimeframes.Specifically,WilliamssubmittedhisapplicationpriortothedateMHAposteditssolicitationforthepositionofDirectorofSecurity,whileMondaysubmittedherapplicationaftertheadvertisedclosingdateforthepositionofExecutiveSecretary.BasedontheseproceduralviolationsinMHAshiringofWilliamsandMonday,HUDinstructedMHAtoterminatetheEmployees.Asinstructed,MHAterminatedtheEmployeesinApril1992.InaccordancewiththegrievanceproceduresoutlinedinMHAsManualofOperations,bothEmployeesfiledgrievances,whichultimatelyweredeniedbyMHAsBoardofCommissioners. TheEmployeessubsequentlyfiledcomplaintsagainstMHAforbreachofemploymentcontract.Intheircomplaints,theEmployeesallegedthatMHAsManualofOperationsconstitutedanemploymentcontractbetweenthepartiesandthatMHAhadbreachedthisemploymentcontractbyterminatingtheEmployeeswithoutjustcause.Basedonthisargument,theEmployeesmovedforsummaryjudgmentontheirbreachofemploymentcontractclaims,aswellastheirclaimsthattheyhadbeendeprivedofpropertyrightswithoutdueprocessoflaw.AfterreviewingtheManualofOperationsandthestipulatedfacts,thetrialcourtagreedwiththeEmployeescontentionand,accordingly,enteredsummaryjudgmentinfavoroftheEmployees.Thedispositiveissueinthisappeal,therefore,iswhetherMHAsManualofOperationsconstitutedanemploymentagreementwhichcontractuallylimitedMHAsrighttoterminatetheEmployees. BecauseTennesseeadherestothe employeeatwillrule,apresumptionarisesinthisstatethatanemployeeisanemployeeatwill. Davisv.ConnecticutGen.LifeIns.Co. ,743F.Supp.1273,1280(M.D.Tenn.1990).Underthiswellestablishedrule,acontractforemploymentforanindefinitetermisconsideredacontractatwillwhichcanbeterminatedbyanemployer(oranemployee)atanytimewithoutcause. Bringlev.MethodistHosp. ,701S.W.2d622,625(Tenn.App.1985); accord  Gravesv.AnchorWireCorp. ,692S.W.2d420,422(Tenn.App.1985); Whittakerv.CareMore,Inc. ,621S.W.2d395,396(Tenn.App.1981). Inrecentyears,thecourtsofthisstatehaverecognized,atleastintheory,thatanexceptiontotheatwillrulemayarisewhereanemployerpromulgatesanemployeehandbookwhichconferscertainbenefitsonemployees /   ׀orwhichlimitstheemployersrighttoterminateemployees. 0   ׀Inordertobeconsideredpartoftheemploymentcontract,however,thehandbookmustcontainspecificlanguageshowingtheemployersintenttobeboundbythehandbooksprovisions. Smithv.Morris ,778S.W.2d857,858(Tenn.App.1988).Unlesstheemployeehandbookcontainsspecificguaranteesorbindingcommitments,thehandbookwillnotconstituteacontract. Whittakerv.CareMore ,621S.W.2dat397.Asstatedbyonecourt, thelanguageusedmustbephrasedinbindingterms,interpretedinthecontextoftheentirehandbook,andreadinconjunctionwithanyotherrelevantmaterial,suchasanemploymentapplication. Claibornev.FritoLay,Inc. ,718F.Supp.1319,1321(E.D.Tenn.1989).Ourresearchhasrevealedfewinstancesinwhichappellatecourtsofthisstatehaveconcludedthatthelanguageofanemployeehandbookwasbindingonanemployer. SeeWilliamsv.MaremontCorp. ,776S.W.2d78(Tenn.App.1988)(holdingthattermsofemployeehandbookwerebindingonemployerwherehandbookprovidedthatemployeeswouldberecalledinorderofseniority); Hambyv.Genesco,Inc. ,627S.W.2d373(Tenn.App.1981)(holdingthatemployeehandbooks rollbackprovisionwasbindingonemployerwherehandbookprovidedthat,forsolongasemploymentrelationshipcontinued,handbookcontainedguaranteedpolicies,practices,andproceduresofemployer); seealsoHooksv.Gibson ,842S.W.2d625(Tenn.App.1992)(concludingthatemployeehandbookbecamepartofemploymentcontractwherehandbookwaspromulgatedpursuanttoagreementbetweenemployerandstateandemployeeswerethirdpartybeneficiariesofsuchagreement). TheemployeehandbookatissueinthiscaseisMHAsManualofOperations.ThedeterminationofwhethertheManualofOperationsconstitutespartofMHAsemploymentcontractwithWilliamsandMondaydependsuponthespecificlanguageusedintheManual. See  Davisv.ConnecticutGen.LifeIns.Co. ,743F.Supp.at1279; seealso  Gregoryv.Hunt ,24F.3d781,785(6thCir.1994); MacDougalv.Sears,Roebuck&Co. ,624F.Supp.756,759(E.D.Tenn.1985).Accordingly,inordertomakethisdetermination,wehaveexaminedtheManualsspecificprovisions.TheManualsforwardstates:8 ThisistheofficialManualofOperationsfortheMemphisHousingAuthority.Itspurposeistoarrangeforreadyreferenceareviewofthepolicies,relationships,andproceduresof[MHA].Itisintendedprimarilyasaguideforemployeesinthedischargeoftheirduties.ArticleIVoftheManual,entitledAMENDMENTS,providesthat:8 TheManualofOperationsandtheByLawsof[MHA]maybeamendedbyanyspecialorregularmeetingoftheBoardofCommissionersbyasimplemajorityofsaidCommissioners,therebeingaquorumpresent.Section208oftheManual,entitledEMPLOYMENTANDPERSONNELREGULATIONS,providesthat:8 AllemploymentandpersonnelproceduresshallberegulatedbytheprovisionshereinafterprovidedinthissectionandelsewhereinthisManual.Inthissection,theManuallistsfourreasonsforterminationofservices:resignation,dismissalforjustcause,retirement,andreductioninforce.TheManualalsolistscausesforwhichanemployeemaybesuspended,demoted,orterminated,anditdividesthecausesintotwocategories,majorinfractionsandotherinfractions.Afterlistingexamplesofinfractions,theManualstates:8 NoneoftheaforementionedMajororOtherInfractionswillbedeemedtopreventthedismissal,demotion,suspension,ordisciplinaryactionofanemployeeforjustcause.JUSTCAUSEshallexistwhen[MHA]hasareasonablebasisfortheactiontakeneventhoughsuchcauseisnotcontainedinthosementionedabove.Finally,Section401oftheManual,entitledPURPOSE,providesthat:8 ThisManualofOperationscontemplatesthateveryfucntion[sic]of[MHA]shallbecarriedoutbyitsmembersandemployeesstrictlyinaccordancewithpoliciesandproceduresadoptedby[MHA],andincorporatedintheManual. AftercarefullyreviewingthespecificlanguagecontainedinMHAsManualofOperations,weconcludethattheManualsprovisionsareinsufficienttoovercomethepresumptionthatWilliamsandMondaywereatwillemployees.TheEmployeescontendthattheManualcontainssufficientguaranteestobebindinguponMHAbecausetheManualspecificallycontemplatesthatallMHAfunctions shallbecarriedoutbyitsmembersandemployeesstrictlyinaccordancewiththeManualspoliciesandproceduresand,further,becausetheManualstatesthat [a]llemploymentandpersonnelproceduresshallberegulatedbytheManualsprovisions.IfthislanguageevidencesanintentonthepartofMHAtobeboundbytheManualsprovisions,however,suchintentiscontradictedbytheexistenceofaprovisionintheManualgivingMHAsBoardofCommissionerstheauthoritytoamendtheManualatanyspecialorregularBoardmeeting. Anylanguagethatpreservesaunilateralrightonthepartoftheemployertoalterormodifythecontentsof[a]handbookgenerallyprecludesthehandbookfrombeingconsideredpartoftheemploymentcontract. Claibornev.FritoLay,Inc. ,718F.Supp.1319,1321(E.D.Tenn.1989); see,e.g. , Smithv.Morris ,778S.W.2d857,858(Tenn.App.1988)(handbookslanguageclearlyshowed thatmodificationswereanticipated); Bringlev.MethodistHosp. ,701S.W.2d622,624(Tenn.App.1985)(handbookreservedtoemployer righttochangeandabolishpolicies,procedures,rulesandregulations); Gregoryv.Hunt ,24F.3d781,786(6thCir.1994)(handbookprovidedthatpolicieswere subjecttochangebymanagement,unilaterallyandwithoutnotice); Davisv.ConnecticutGen.LifeIns.Co. ,743F.Supp.1273,1279(M.D.Tenn.1990)(handbookreservedtoemployer righttochangeanyorallsuchpolicies,practicesandproceduresinwholeorinpartatanytime,withorwithoutnotice).Suchlanguageinsteadindicates thatthehandbooksimplyconstitute[s]asetofguidelinesorasourceofinformationforanemployee. Claibornev.FritoLay ,718F.Supp.at1321.InthecaseofMHAsManualofOperations,thisconclusionisfurthersupportedbylanguageindicatingthattheManualspurpose isintendedprimarilyasaguideforemployeesinthedischargeoftheirduties. EveniftheManualofOperationslanguagedemonstratesanintentonthepartofMHAtobeboundbytheManual,wefindnothingintheManualsprovisionswhichwouldaltertheEmployeesstatusasatwillemployees.First,wenotethattheManualdidnotentitletheEmployeestoaspecifictermofemploymentbecausetheManualsprovisionsgavetheEmployeesnoassurancesofemploymentforanydefinitetime. See  Gravesv.AnchorWireCorp. ,692S.W.2d420,421(Tenn.App.1985); Whittakerv.CareMore,Inc. ,621S.W.2d395,397(Tenn.App.1981); accord  Davisv.ConnecticutGen.LifeIns.Co. ,743F.Supp.1273,1280(M.D.Tenn.1990)(concludingthat,becauseTennesseestillclingsto employeeatwillrule,presumptionthatemployeeisatwillmustbeovercomebyspecificlanguageguaranteeingdefinitetermofemployment).Moreover,contrarytotheEmployeesargument,thetermsoftheManualdidnotlimitMHAsrighttoterminatetheEmployeesbyrequiringthatanyterminationofservicesbeforoneoftheenumeratedreasons,suchasjustcause.AlthoughtheManuallistedonlyfourreasonsfortermination,includingresignation,dismissalforjustcause,retirement,andreductioninforce,thislistdidnotpurporttobeexclusive.Indeed,theManualsinclusionofreductioninforcetothislistcontemplatesthatcertainbusinessexigenciesmayarisewhichnecessitatedismissingemployeesforreasonsotherthanjustcause.Inthiscase,therefore,wecanfindnolanguagethatunequivocallyovercomesthepresumptionthatWilliamsandMondaywereatwillemployees. See  Gregoryv.Hunt ,24F.3dat787; Davisv.ConnecticutGen.LifeIns.Co. ,743F.Supp.at1280.  Basedontheforegoinganalysis,weconcludethatthetrialcourterredinrulingthatMHAsManualofOperationsconstitutedanemploymentcontractwhichlimitedMHAsrighttoterminatetheEmployees;therefore,wereversethetrialcourtsordersenteringsummaryjudgmentinfavoroftheEmployeesontheirclaimsforbreachofemploymentcontract.ThisholdingleadsustotherelatedconclusionthatMHAsManualdidnotgranttheEmployeesanyprotectiblepropertyinterestincontinuedemploymentwithMHA. See  Gregoryv.Hunt ,24F.3dat787.Accordingly,wealsoreversethatportionofthetrialcourtsordersenteringsummaryjudgmentinfavoroftheEmployeesontheirdueprocessclaims.Finally,ourdispositionoftheEmployeesclaimsrequiresthatthetrialcourtsfinalordersgrantingbackpayandreinstatementbereversed. Thetrialcourtsjudgmentsarereversedandthesecausesremandedforfurtherproceedings.CostsofthisappealaretaxedonehalftoWilliamsandonehalftoMonday,forwhichexecutionmayissueifnecessary.      ____________________________________      FARMER,J.______________________________HIGHERS,J.(Concurs)______________________________LILLARD,J.(Concurs)